Jet Airways shares fall 8% on reports of temporary shutdown

JetBlue A320

In a filing to BSE, Jet Airways reacted to queries from the stock exchanges on a media report that said "Jet Airways likely to temporarily shut down its operations" stating it is awaiting emergency liquidity support from the consortium of lenders led by State Bank of India.

Jet Airways aircrafts are seen parked at the Indira Gandhi International Airport in New Delhi, India, April 13, 2019.

Separately, an Indian government official said funding was likely to come through and that the banks were not looking to take Jet to bankruptcy court.

Jet Airways has sought emergency funds from banks and is now operating only five planes, Civil Aviation Secretary Pradeep Singh Kharola said on Tuesday.

On Monday, lenders did not take a final decision on providing emergency funds to the cash-strapped carrier.

The board has asked CEO Vinay Dube to engage with lenders on interim funding for one last time, sources said, adding that Dube has been authorised by the board to announce complete halting of operations by evening if lenders do not agree to release the funding.

"Lenders are committed to a revival plan for Jet Airways", Punjab National Bank's Managing Director Sunil Mehta said. All its worldwide services are formally suspended through April 18. In an email to anxious employees CEO Vinay Dube yesterday announced that with the interim funding still not forthcoming, Jet Airways has extended the cancellation of global operations till April 19.

On Monday, SBI said the bid process for the orderly sale of equity in Jet Airways is now being run by SBI Caps and is being vetted by the legal team and the prospective bidders will be shortlisted by SBI Caps shortly.SBI spokesperson Monday also said, "The bid process for the orderly sale of equity in Jet Airways is now being run by SBI Caps and is being vetted by the legal team".

"Directed Secretary @MoCA_GoI to review issues related to Jet Airways, especially increasing fares, flight cancellations etc", Prabhu said in a tweet.

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