Jet Airways staff start voting on revival offer

Employees of Jet Airways, including more than 100 people stationed in the Gulf before the airline halted operations, will have until August 4, 2021 to decide on an offer presented to them by its new owners.

According to airline industry sources, 95 per cent of the employees of the airline will have to agree to the revival package offered by a consortium that won the bid to revive the defunct carrier, or risk losing the benefits. The airline staff began voting on July 5.

The consortium formed by the UAE-based entrepreneurs Murari Lal Jalan and Kalrock Capital won the bid to revive Jet Airways in October 2020.

At the peak of its operations four years ago, Jet Airways used to operate 50 flights per day to 10 cities in the GCC, including three airports in the UAE.

India’s top bankruptcy court, the National Company Law Tribunal, cleared the consortium proposal to revive the airline on June 22. While the airline had admitted claims of around Rs150 billion, the consortium has offered to settle claims of Rs4.75 billion of financial and non-financial creditors

Already, the airline’s creditors have taken an almost 95 per cent haircut under the resolution plan. The winning consortium has proposed to pay Rs3.85 billion against claims of Rs78.08 billion raised by its financial creditors.

As per the plan, a welfare trust will be formed of all the staff and it will hold 0.5 per cent stake in the airline and 76 per cent stake in its ground handling subsidiary. Employees and workmen would be paid Rs11,000 and Rs22,800 respectively. Each of the workmen would be given a phone, laptop or an ipad through a lottery basis and ticket vouchers worth Rs10,000.

There were around 9,000 employees with the airline in June 2019 and that figure has dwindled to around 3600. In case 95 per cent of staff do not vote in favour of the proposal it will automatically lapse. The 0.5 per cent stake reserved for the staff and Rs80 million allocated for making cash payments to them will be given to financial creditors.

Only 50 of the existing staff will be absorbed in the airline and the rest will be transferred to the ground handling subsidiary as a part of the resolution plan.

— issacjohn@khaleejtimes.com