At Least Five Investors Show Initial Interest In Jet Airways

Jet Airlines finds five suitors right before its final call.

Jet Airways aircraft sit on the tarmac at the airport in Mumbai. (Photographer: Dhiraj Singh/Bloomberg)
Jet Airways aircraft sit on the tarmac at the airport in Mumbai. (Photographer: Dhiraj Singh/Bloomberg)

Lenders to beleaguered Jet Airways (India) Ltd. have received initial interest from at least five investors in the fourth round of bidding, according to a person privy to the development.

U.K.-based fund Kalrock Capital, U.S.-based Imperial Capital, Hyderabad’s Turbo Aviation, South American investor Synergy Group and Indian entrepreneur Sanjay Mandavia have submitted their interest so far, the person said on the condition of anonymity as the details aren’t public yet.

The deadline to submit expressions of interest ends at midnight on Thursday. According to the person cited earlier, lenders are expecting more bids to come in before the deadline. They will soon review the documents submitted by the potential bidders to check whether they qualify for the bid.

Among the bidders, Synergy Group and Turbo Aviation participated in the third round. Turbo Aviation, which makes ground equipment for airlines and also provides support staff, didn’t qualify in the previous round since it didn’t submit adequate documents required under the insolvency proceedings, the person cited earlier said. In the case of Synergy Group, while discussions went into advance stages, the bidder didn’t submit a final bid as it couldn’t get requisite assurances from lenders.

Kalrock Capital, a global financial advisory firm, specialises in real estate, venture capital and special situations investments. Imperial Capital is an investment bank based in U.S. led by Jason W Reece. Mandavia, a former pilot, runs Flight Simulation Technique Centre in Gurgaon and Hyderabad to train pilots.

Manoj Narender Madnani, board member of Kalrock Capital, confirmed to BloombergQuint in an emailed response that they have submitted an expression of interest for Jet Airways under the Insolvency and Bankruptcy Code.

“As part of our special situations investment business we look at essential services as an area of investment. We believe that India’s aviation infrastructure and the Jet Airways brand are something we can get behind,” he said. “We’re expecting that once flight operations resume globally, this business can really take off for India.”

On May 13, the lenders led by State Bank of India had invited expressions of interest for Jet Airways for the fourth time since insolvency proceedings started in June 2019. BloombergQuint had earlier reported that if the fourth round did not fetch any major bids, the airline would be sent for liquidation.

The committee of creditors invited expressions of interest from strategic investors with a minimum net worth of Rs 500 crore or minimum available funds for investment or deployment in Indian companies of Rs 500 crore. Financial investors who want to submit interest for Jet Airways must have assets under management worth at least Rs 500 crore, according to the bidding document on the airline’s website.

The qualifying criteria for the bidders has been lowered for the fourth round compared to the preceding round where the lenders were seeking strategic and financial investors with net worth or investible funds of over Rs 1,000 crore. The last round concluded in February, with no bidder turning up.

Financial creditors to Jet Airways are owed Rs 8,232 crore, while operational creditors have outstanding dues of over Rs 7,300 crore, according to details available on the airline’s website.