Jet Airways chairman Naresh Goyal on Tuesday said the company has put its plan to come out with a $400-million rights issue on hold for two to three months.
Carrier says it has no need for money for the time being
NEW DELHI: Jet Airways chairman Naresh Goyal on Tuesday said the company has put its plan to come out with a $400-million rights issue on hold for two to three months. He, however, added that the issue would come out during the current fiscal itself.
Goyal said the company did not need money right now and cited the recent turmoil in global credit markets as another reason.
He was speaking to reporters at a press conference, marking the company's inaugural flight to Toronto.
"Banks are still willing to lend, but we have decided to delay it," he said. Jet's board had approved raising up to $400 million through a rights issue in June to finance its expansion and overhaul of Air Sahara, which it took over in April and renamed as Jetlite.
"Jetlite's cost of operations has come down by 50% since we took over," he said, adding that the company would break even before the end of the current fiscal. He said they were trying to develop synergies between Jet and Jetlite.
On the proposal to waive off the five-year experience norm for airlines flying international, Goyal said, "Whatever the government decides, we will see…We are ready for competition."
Union civil aviation minister Praful Patel, who was also present during the conference, emphasised on the need to have more Indian players flying abroad. He said Indian carriers should fly to newer international destinations.
Jet, which launched its US flights last month, plans to add more destinations in Europe and North America.
"We are seeing very high seat loads in the coming months in our US flights," said Goyal. Jet is looking at increasing the share of overseas operations to half its revenue by 2009.
Jet was looking at firming up options for seven 777 and 10 A-330 aircraft. The company is expected to finalise plans for a cargo carrier by the end of 2007 and was talking to potential partners, Goyal said. "We will then decide whether to do a joint venture or go alone."
It's also looking at co-operating with Air India on some overseas routes for flights and other services and starting an MRO (maintenance, repair and overhaul) operation.
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