jet airways: Bankruptcy court approves Kalrock-Jalan’s resolution plan for revival of Jet Airways – The Economic Times

Clipped from: https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/bankruptcy-court-approves-kalrock-jalans-resolution-plan-for-revival-of-jet-airways/articleshow/83741240.cms?utm_source=ETTopNews&utm_medium=HPTN&utm_campaign=AL1&utm_content=23Synopsis

The Mumbai bench of the National Company Law Tribunal presided by judicial members – Janab Mohammed Ajmal and V Nallasenapathy while allowing the resolution plan in an oral order, also directed the successful bidder to get the required approval and licenses from relevant authorities within 90 days.

The dedicated bankruptcy court on Tuesday has approved the resolution plan of Kalrock Capital and entrepreneur Murari Lal Jalan for the revival of defunct carrierJet AirwaysNSE 4.96 % Ltd.

The Mumbai bench of the National Company Law Tribunal presided by judicial members – Janab Mohammed Ajmal and V Nallasenapathy while allowing the resolution plan in an oral order, also directed the successful bidder to get the required approval and licenses from relevant authorities within 90 days.

At the time of approval of the plan, advocates Udayan Shah and Ashish Mehta, while appearing for the DGCA and MoCA sought to stay the implementation of the order for eight weeks with the arguments that the regulator wants to challenge the order in National Company Law Appellate Tribunal (NCLAT). However, the tribunal rejected the plea of the regulator and the ministry.

Naresh Goyal founded Jet Airways over 26 years ago. The airline stopped flying on April 17, having failed to raise money to keep itself afloat and was admitted for the resolution process in June 2019.

Last week on June 18, the Mumbai bench of the National Company Law Tribunal (NCLT) had reserved its order after hearing all parties including the successful resolution applicant, lenders, DGCA and others.

While the bankruptcy court was hearing a revival plan submitted by the Kalrock-Jalan consortium, they had also sought clarification from the Ministry of Civil Aviation, as well as the Directorate General of Civil Aviation (DGCA) about the availability of the slots to the company on the basis of historicity.

Subsequently, the tribunal had also directed the government to inform the NCLT about the status of the erstwhile slots of Jet Airways.

The defunct airline’s committee of creditors had in October last year approved a resolution plan submitted by a consortium of asset management firm Kalrock Capital and entrepreneur Murari Lal Jalan.

The government had clarified in response to the tribunal that, “These slots are not the assets of the corporate operator and for any airline, they are merely permissions, which remain with the airline subject to fulfilment of certain requirements.” Also, MoCA and DGCA said, “Further, bilateral rights are national assets and not the asset of any airline which is using them and is to be optimally utilised at all times. In view of the said factual position, the same can’t be claimed as a matter of right.”

“Resolution applicant will have to move swiftly to obtain the necessary approvals as there are strict timelines mentioned in the order,” said Ashish Pyasi Associate Partner Dhir & Dhir Associates. “The finer details are awaited however as there are no rights on the basis of historicity, slots will be considered as and when the application is made to the concerned authorities.”

As per the resolution plan, the successful bidder has proposed a total cash flow of Rs 1375 crore for the revival of the company. The revival plan envisages starting operation with 30 aircraft within six months from the date of the approval of the plan by NCLT.

The company had received a claim of about Rs 24,8879 crore, out of which Rs 8,462 crore were admitted by the resolution professional of the company.

As per the plan, workmen and employees will get Rs 113 crore against their claim of over Rs 1,200 crore in 180 days, while financial creditors will get Rs 1,010 crore against their claims of Rs 7,454 crore, in tranches in five years.

According to the plan, the Kalrock-Jalan consortium will hold 89.79% in the airline, the assenting financial creditors will hold 9.50% in the airline. Earlier promoters Naresh Goyal’s shareholding of 51%, as well as Etihad’s 24%, come to zero, while public shareholding decreases from 25% to 0.21%.

Senior Counsel Gaurav Joshi and an advocate Rohan Rajadhyaksha appeared for the resolution professional. While, Senior Advocate, Ravi Kadam appeared for the successful bidder.

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