Sector’s GDP contribution is expected to have nearly doubled this year from 2021 to 36.1%
Financial creditors to Jet Airways will be taking around 95 per cent haircut as the grounded airline returns to skies after two years while customers who were left with unused tickets will get refunds of up to Rs15,000.
The decision follows the approval of a revival plan submitted by the carrier’s new owners.
As the successful bidder, Jalan-Kalrock consortium has proposed to pay banks Rs3.85 billion against the total claim of Rs78.077 billion. Out of that Rs1.85 billion will be paid upfront within 180 days after start of operations of the company, whereas Rs1.95 billion will be paid through issuance of zero coupon bonds, each of Rs1,000 face value after two years.
Public shareholders will get one share each for 100 shares held by them, and will hold 0.21 per cent in Jet Airways (India) Ltd. And against their dues, employees and workmen will own 0.5 per cent in Jet Airways and 75 per cent in Airjet Ground Services Ltd. via a trust.
The resolution plan of Dubai-based entrepreneur Murari Lal Jalan and UK-based Kalrock Capital Partners was approved by the National Company Law Tribunal on June 22. The consortium, which will hold 89.79 per cent in Jet Airways, has proposed a cash infusion of Rs13.75 billion in the carrier. Out of this, Rs4.75 billion will be used to pay stakeholders and Rs9 billion as working capital and capex expenditure.
The refund for customers is only offered to those who managed to file a claim with the airline and had their claims accepted, to the extent of Rs15,000. The refund will be paid in cash, or customers will be offered the option to collect vouchers usable with the new Jet Airways when it comes into operation. The timeline to make these refunds is not set at the moment, sources close to the airline said.
According to the approved resolution plan, for claims up to Rs15,000, cash refund will be processed as per actuals. For claims over Rs15,000, cash refund will be processed to a maximum of Rs15,000. Alternatively, credit for future tickets will be provided as per actual admitted claim amounts of up to Rs15,000.
Credit for future tickets will be issued in the form of redeemable vouchers in the multiples of Rs1,000. Vouchers will be transferable in nature (prior to issuance of any ticket). No tickets will be transferable in nature. Vouchers can be redeemed against more than one ticket.
Booking of tickets against redemption of such vouchers must be completed within 30 Days of the Corporate Debtor recommencing (Jet 2.0) its domestic operations.
Tickets can be availed during April – June Quarter and August – October Quarter on any sector where Jet 2.0 flies.
This means that most people who had tickets outstanding won’t be made their amounts whole by the new airline.
Employees and workmen will get Rs520 million against their claim of Rs7.15 billion. As per the resolution plan, employees can form a welfare trust which will have: 0.5 per cent stake in Jet Airways. 76 per cent stake and management control of demerged entity Airjet Ground Services. Airjet Ground will be a wholly owned subsidiary of Jet. A token sum of Rs11,000 each to employees and workmen and certain benefits in the form of medical, school fees reimbursement, free tickets and IT assets.
The resolution plan has also proposed a scheme for absorption of employees. All this is conditional on 95 per cent employees and workmen approving the resolution plan within 30 days. Operational creditors will be given Rs100 million in total. Against outstanding tickets, operational creditors can either choose to get cash refund or seek credit for future tickets. Claims relating to lost Jet Privilege Miles will not be entertained. — issacjohn@khaleejtimes.com
Sector’s GDP contribution is expected to have nearly doubled this year from 2021 to 36.1%
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