Jet Airways clears pending Dec salaries of pilots, other staff
Mumbai, Mar 31 (IBNS): Cash-strapped Jet Airways has finally cleared the pending December salaries of staff amid threats by pilots to stop operating flights from April 1.
The pilots’ union his scheduled to meet on Sunday to decide further steps.
They have threatened to stop flying from April 1 if all dues are not settled.
According to reports, only 12.5 per cent of December salary was paid earlier and on Saturday the airline credited the remaining 87.5 per cent for the month.
The airline is yet to pay full salaries for the months of January and February to its staff which includes pilots, engineers and senior management.
Naresh Goyal resigns:
Amid growing crisis, Naresh Goyal, founder and chairman of cash-strapped Jet Airways, and his wife Anita Goyal resigned from the board of directors of the airlines.
The fresh development took place at a time when a majority of the cash-strapped airline's fleet has been grounded amid non-payment of dues to banks, suppliers, pilots and lessors.
Goyal and his wife had founded the airlines around 25 years ago.
Rs 1,500 crore bailout for Jet Airways
The resignation of Jet Airways founder Naresh Goyal and his wife Anita Goyal on Monday from the board of the airline has cleared the way for a Rs 1,500 crore bailout by a consortium of banks led by State Bank of India.
The bank are converting their debt into equity by taking a controlling stake in the 25-year-old airline for a token sum of Re 1.
In a statement, Jet Airways said as a sustainable solution to restore normality to the operations of the airline, its board took approved the following proposals:
1. The conversion of INR 1 of Lenders’ debt into equity by the issuance of 11.4 crore equity shares, in accordance with the RBI Circular of 12th February, 2018. With this, the consortium of Indian lenders, led by State Bank of India (SBI), will become the majority shareholders of Jet Airways.
2. Reconstitution of the Board of Directors of the company by:
o Resignation of Promoter, Mr Naresh Goyal, Mrs. Anita Goyal, and Mr. Kevin Knight, nominee director of Etihad Airways from their positions on the Company’s Board.
o The two nominees of the Promoter and one nominee of Etihad Airways will continue on the Board.
o Two lender nominees will be inducted to its Board, subject to the receipt of requisite approvals.
As part of the Resolution Plan, the lenders will provide an immediate interim funding support of Rs 1500 crore to Jet Airways. The company will also engage with payment intermediaries for release of trapped cash. The airline will leverage the funding to partly clear pending dues towards lessors, vendors, creditors and employees in a phased manner.
Jet Airways currently operates flights to 56 destinations in India and abroad.