Two Jet Airways creditors approach NCLT for insolvency case

Grounded airline Jet Airways has now been dragged to the National Company Law Tribunal (NCLT) by two creditors - Shaman Wheels and Gagar Enterprises. As per recent reports, they have approached the insolvency court for the recovery of dues. The case will be heard by the NCLT's Mumbai bench consisting of two members. 

If the NCLT agrees to hear the matter, then other lenders like SBI may join the aggrieved parties.

The banks have been trying to keep the Jet Airways out of the insolvency court so that they can recover the maximum dues from the airline. The banks have been working on a resolution to the debt crisis since October 2018, but have not come up with any concrete plans. If the NCLT agrees to hear the plea, then the banks may have to bear a huge haircut on their dues.

Reports have said that the Hinduja Group and Etihad Group had not submitted the final proposal for picking up a majority stake in the troubled airline. 

An Economic Times report said these two potential investors are insisting on wiping out the equity holdings of existing investors, including minority owners. That means lenders may have to write-off about 60% of their arrears from the airline and take convertible securities for the remaining

On April 17, Jet Airways was grounded due to liquidity crunch and has is yet to resume operations since. As of March 31, 2018, Jet Airways recorded a debt of Rs 8,000 crore and a loss of more than Rs 14,000 crore.

The next hearing on the matter is on June 13.