Last Update: January 13, 2023, 3:41 PM IST
Kalrock Capital and UAE-based businessman Murari Lal Jalan were selected by the lenders in October 2020 to revive the grounded airline.
Jet Airways shares rose over 5 per cent on Friday after the National Company Law Tribunal allowed the transfer of ownership of the airline
Shares of Jet Airways rose over 5 per cent on Friday after the National Company Law Tribunal allowed the transfer of ownership of the airline to the winning bidder Jalan-Kalrock consortium. The tribunal also approved the effective date of ownership of the resolution plan as November 16, which means that from this date, the consortium gets six months or 180 days to clear its dues to the lenders.
So far, the Jalan-Kalrock consortium has deposited bank guarantees worth Rs 150 crore with the lenders. As per the resolution plan, the consortium will have to pay Rs 185 crore in cash to the financial creditors within 180 days from the effective date.
The consortium had also proposed a total cash investment of Rs 1,375 crore, of which Rs 475 crore would be for payment to stakeholders. The remaining Rs 900 crore was to be infused for capital expenditure and working capital requirements. At Rs 380 crore, the lenders took a huge cut on their approved claims under the approved resolution plan amounting to over Rs 7,807.7 crore.
The order came after the JKC sought directions from the bench for transfer of ownership of Jet Airways and setting the ownership transfer date as the starting date for the 180-day time limit. However, the lenders to Jet Airways opposed the transfer of ownership, stating that the preconditions were not met by the consortium.
This was a point of disagreement between Jet Airways’ lenders and JKC that led to the impasse, as the October 21 order of the National Company Law Appellate Tribunal (NCLAT) said that JKC had “done all necessary steps to the satisfaction of the Monitoring Committee”. The prerequisites have been met”.
The Effective Date is not the Transfer Date; This is when the pre-conditions are deemed to have been met as per the plan. As per the resolution plan approved by NCLT, JKC is allowed 180 days from the effective date to pay the creditors.
Jet Airways shut down in April 2019 due to losses and a debt of around Rs 8,000 crore. A consortium of London-based Kalrock Capital and UAE-based entrepreneur Murari Lal Jalan emerged as successful bidders in the insolvency resolution process of Jet Airways.
The tribunal, in its order dated June 22, 2021, had approved the resolution plan submitted by the Jalan-Kalrock consortium, subject to necessary approvals. The consortium includes UAE-based NRI Murari Lal Jalan, who will hold shares in Jet Airways in his individual capacity, and Florian Fritsch who will hold shares through his investment holding company Kalrock Capital Partners Limited, Cayman.
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