Will Jet Airways get the Emergency Funds it needs to rise above the ground or will it die?

Bengaluru April 28: With The Longest living private Indian Airline Jet Airways suspending its all operations, the lives of more than 15,000 of its employees are at stake. Right from a Ground staff to all the way up to the flight captain no one has been paid salaries for more than 2 months. This, in fact, is creating a string of difficulties for the employees. The National Aviator’s Guild (NAG) has pleaded Prime Minister Narendra Modi to direct SBI to release funds to take care of part of the pending salaries. However, due to the elections around where the Prime Minister is seeking for the second term, it would be a difficult situation for the prime minister to take any actions towards the same.

The Lenders consortium led by SBI has disapproved any interim funding to take care of fuel and critical services including salaries to keep the operations running. It is estimated that the airline needs around 8,500 crores to lift its head once again and take to the skies. Goyal and Dube are looking out for alternate emergency funds from various sources

Sources have informed that talks are on with Reliance Chief Mukesh Ambani to come onboard and inject funds required in exchange for equity. Goyal had knocked the doors of the Ambanis in October 2018 while the airlines were facing initial crunch towards the working capital. However, the Reliance Industries Chairman is yet to take action on the same and has been non-committal.

It is also expected that the TATA group might take up a stake or purchase part of the assets and may merge them with the Group owned TATA SIA which operates Vistara Airlines which is developing its network in India and abroad. Recently the Tata Group have infused additional funds into TATA SIA to acquire more slots that Jet Airways had held until recently.

But in a surprise turn, a few days back, a Syndicate led by Saudi-based Gold Tower Group’s Chief Executive Mohammed Nagaman Lateef and supported by Indian Economic Trade Organization (IETO) President Mr. Asif Iqbal came forward to raise the requisite funds through a string of lenders and NRIs based out of the Gulf
Region. Mr. Lateef and Mr. Asif Iqbal, both originally from Bengaluru have been discussing with many NRIs who wish to see the Airline go up.

Mr. Asif Iqbal said “If Goyal and Dube are able to satisfy our queries, then the syndicate will be able to raise initial funds to get the airline up and running within the next 10 days.  Once up, we will infuse the rest of the funds over a period of 3 years”. He also mentioned that if all goes fine then IETO will frame the deal.

Mr. Lateef is the CEO of the Gold Tower Group, a major construction firm in the kingdom of Saudi Arabia and has a good influence in the Gulf Region. Whereas Mr. Asif Iqbal being the president of IETO, is also the Secretary General of the Asian Arab Chambers of commerce, an chamber which has its access and connections in over 52 countries in both the Arab Countries which includes Middle East and North America (MENA region) as well as the SAARC & ASEAN countries.

Hence, while the airline is currently grounded, the next fortnight seems to be an important period to see if the airlines receive the emergency funds it needs to rise above the ground and reach the skies. Until then it’s just a wait and watch game.

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