Mumbai: Jet Airways (India) Ltd has approached investment bankers again to help sell a stake in the carrier, two people with direct knowledge of the matter said. The fundraising is crucial for the airline, owned 24% by Etihad Airways PJSC of Abu Dhabi, as it faces several challenges including a surge in fuel prices, weaker rupee and intensifying competition. “Jet Airways is looking to raise immediate cash and the transaction may include Jet Airways founder Naresh Goyal offloading a part of the promoter’s stake in the company," one of the two people said on condition of anonymity.

Goyal owns a 51% stake in Jet Airways, the second-largest carrier in India by market share.

“Few months ago, when the discussions (on stake sale) were ongoing, the promoters were looking for a significant premium to the then market price of the airline but things are expected to be slightly different as the urgency to raise cash is far greater now," the second person added.

Jet Airways reported a loss of 636.45 crore in the year ended 31 March. In the same year, smaller rival SpiceJet reported a profit of 566.66 crore and IndiGo, India’s biggest airline, reported a profit of 2,242.37 crore.

The second person said Etihad had previously sought to purchase a controlling stake in Jet Airways, but the offer was declined by Goyal.

Jet Airways had in November last year signed an enhanced cooperation agreement to expand operations between Europe and India with Air France-KLM. The pact has led to uncertainty over whether Etihad will continue as a stakeholder in Jet Airways, the second person said.

A Jet Airways spokesperson said the airline does not comment on speculation as a matter of policy. Etihad’s media team did not respond to an email seeking comment till Thursday night.

Rising jet fuel prices and a depreciating rupee against the dollar have swelled operating costs of airlines as the bulk of payments are dollar-denominated. The benchmark Brent crude price surged 43.4% in the past 12 months. The rupee weakened 7.2% against the dollar in the same period.

Aviation consultant CAPA India had in March said Etihad may sell its entire stake in Jet by the December quarter. At that time, Jet Airways said it does not comment on speculation. Etihad bought its stake in Jet Airways in April 2013 for about 2,069 crore.

Jet Airways’ management had earlier this week asked a section of its employees to take up to a 25% pay cut. The airline’s total costs increased from 5,719.5 crore during January-March 2017 to 7,091 crore at the end of March 2018. It had a gross debt of 8,425 crore as of end-March 2018.

The carrier is scheduled to announce financial results for the June quarter on 10 August.

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