new Delhi. Jet Airways, the country’s largest private airline, is preparing to fly once again. Jet Airways, which was closed due to debt burden, has got new investors. In the proceedings of the National Company Law Tribunal (NCLT) under the Insolvency Code, the committee of banks / financial institutions lending to Jet Airways, on behalf of the alliance of Kalrock Capital and Murari Lal Jalan, approved the plan submitted to buy the airline. Has given However Kapil Kaul, head of CAPA India, which provides research and consulting services on the aircraft industry, says the way to restore operations is difficult and uncertain.
He said that the conditions that were approved by the Jet Airways borrowers were not understood by CAPA. The scheme is yet to be put up for NCLT approval. The jet’s fleet at one time consisted of 120 aircraft, leaving only 16 at the time of its closure. Jet Airways had a loss of Rs 5,535.75 crore in the financial year ended March 2019. Jet Airways ceased operations on 17 April 2019.
Naresh Goyal’s will is heavy
Naresh Goyal has friendships with many leaders, policymakers, chief executives, airline leasing and manufacturers. He listened to everyone to save Jet Airways but did his own thing. Naresh Goyal also consulted Deepak Parekh to save Jet Airways. At that time the Tata group wanted to buy the troubled jet. A private equity consortium led by TPG Capital was also in the running at the time. Then Deepak Parekh had advised Neresh Goyal to step back and give new investors a chance. Parekh was the chief advisor to the Abu Dhabi government. Etihad, the Abu Dhabi state-run airline company, was Jet’s partner. He refused to step down. Goyal was confident that he would save his company. But this could not happen. Till now, the Tata group, interested in the deal, also pulled back.
According to ET, Goyal has made many mistakes. It was a difficult decision for him to leave the company, which has made the situation worse. Even he had investors like the Tata group ready to invest but Goyal was not ready to give anyone else a chance. He had retained his post till January 2019. But Jet Airways had started a bad phase.
Many experts say that Jet’s troubles started when Goyal bought rival Sahara in 2007 for Rs 1450 crore. With this deal, Jet Financial, Legal and HR got caught in many problems. Goyal bought Sahara to compete with Air Deccan, Indigo and SpiceJet. But this strategy backfired completely. Also, Goyal spent the IPO money in ordering new planes.
After this, Goyal made a second mistake. He ordered 10 Airbus A330 and Boeing 777 planes. By buying two types of planes, Jet did nothing but increase its spending. Along with this, Goyal also kept the seat low. Where there are 400 seats in global practice, there were only 308 seats. That is, he finished a quarter of the revenue himself. When the lenders tried to auction the jet, Goyal bid from London. But his offer was rejected. On many such occasions Etihad and TPG threatened that if Naresh Goyal would not pull his hand, he would be out.