NEW DELHI: Alarmed by the speed at which Jet Airways is flying from bad to worse, lenders of the crisis-hit airline led by State Bank of India have asked chairman and promoter Naresh Goyal and his management team to step down with immediate effect. They have also told him to reduce his stake in the company from 17 per cent to 10 per cent.
“The lenders have made their case very clear. The plan is to overhaul the management with Naresh Goyal stepping down. They are ready to give Jet Airways time till March 24 to come up with a better proposal. Else, the Committee of Creditors is likely to take hold,” a senior finance ministry official told Express.
SBI chairman Rajnish Kumar along with Aviation Secretary Pradip Singh Kharola and Principal Secretary to Prime Minister Nripendra Misra met Finance Minister Arun Jaitley on Wednesday.
Kumar said the meeting was to apprise the government of the fluid situation. He added that the lenders will make every effort to keep Jet Airways flying and invoking the Insolvency and Bankruptcy Code (IBC) would be the last option.
Sources said the reason why bankers are wary about IBC is because most of the loans to Jet Airways were given against brand value without any tangible collateral. This means the bankers will not be able to recover any value.
Banks are willing to infuse funds in the airline if the current promoters are willing to pledge their shares and later reduce stake, sources said.