Insta
As Jet Airways Fails To Takeoff, Etihad Rushes In To Rescue; Stands As Guarantor For Fresh Loans
Jet Airways displaying India’s first Boeing 737 Max aircraft at Jet Airways Hangar. (Satyabrata Tripathy/Hindustan Times via Getty Images)
Offering a rescue act, Etihad Airways has decided to guarantee loans up to $150 million that are essential for Jet Airways India to keep their services operational. After talks about the infusion of equity and allowing a third partner from India, the aforementioned news was announced, Mint has reported.
Mint quoted its source as saying, “As an immediate measure, Etihad has agreed to stand as a guarantor for any fresh loans to be raised by Jet Airways and has engaged at least two foreign banks, one of them headquartered in the UK, to syndicate the new loans.”
Between December 2018 and April 2019, the airlines will be requiring about $500 million to repay the loan and pay for the operations it carries out in the period. Currently, Etihad holds 24 per cent equity in Jet Airways. Salaries pending, lease rental payments to be made, Jet is going through severe financial troubles, and its share price since January 2018 has gone down by 66 per cent.
Due to worsening credit profile, after ICRA Ltd marked Jet as ‘B’, it has become very difficult for the airlines to raise any money.
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