Jet Airways cancels all flights as banks decline emergency funding

Read Jet Airways Statement On Temporary Suspension Of Flight Operations

In a series of tweets, Mallya said that the collapse of Jet Airways and his Kingfisher Airlines (which is now defunct) is largely due to the policies of the government.

Jet Airways, in its letter said SBI had earlier in the day rejected an offer for interim funding of Rs 983 crores and were compelled to cancel all worldwide and domestic flights.

"We have in the past witnessed many airlines shutting shop and it is time to appreciate that the razor thin margins which airlines are forced to operate with in a competitive environment, results in a scenario that encourages unsustainability", he noted.

This will undoubtedly impede Jet Airways' chances of restarting flight operations anytime soon as they will need to re-secure aircraft.

Separately, an Indian government official said funding was likely to come through and that the banks were not looking to take Jet to bankruptcy court.

"The worldwide flight to India normally operates on full capacity and Jet's withdrawal would have little impact", he said.

On March 25, 2019, a consortium of Jet Airways domestic lenders, led by State Bank of India, became the majority shareholders and took a transient control of the airline, until a suitable investor is found. All flights will be cancelled, starting today, April 17th.

The Jet Airways statement continued: "Over the last several weeks and months, the company has tried every means possible to seek both interim and long-term funding".

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The carrier, however, said it will now await the bid finalisation process by the lenders. We are worth investing in, you are worth investing in and we confident that we will be back to share the joy of flying with our fellow-guests once again.

Its lenders, led by State Bank of India (SBI), last week accepted expressions of interest for an up to 75 percent stake in the airline.

The Airlines previously requested lenders for interim funding of Rs 400 crore to stave off a temporary closure.

If Jet fails to attract a buyer and collapses that would put thousands of Jet's employees out of jobs, many of whom have been unpaid for weeks or months, and affect thousands of others whose jobs are tied to the fortunes of the airline.

Jet shares closed 8.1 per cent lower at 240.50 rupees.

Jet's failure would also be a blow to Indian Prime Minister Narendra Modi, who is now seeking re-election in a weeks' long general election.

Jet Airways is unique and it is unique because of its employees.

Meanwhile, the Ministry of Civil Aviation (MoCA) said on Wednesday it will support the resolution process within the existing regulatory framework. Once deregistered, lessors are free to reclaim a plane and lease it to another airline anywhere in the world.

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