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Jet Airways to raise $300 million via overseas borrowing to trim high cost debt

Jet Airways to raise $300 million via overseas borrowing to trim high cost debt

Private carrier Jet Airways today said it will raise $300 million through the external commercial borrowing (ECB) route to retire its high cost debt.

"In terms of ECB transactions, we have got the necessary approvals from the Reserve Bank to raise $ 150 million for which the documentation process is underway.
     
"We expect to complete the transaction in this quarter. We are also working on another ECB transaction of $150 million," Jet Airways Acting Chief Executive Ravishankar Gopalakrishnan said during an analyst call.
     
The airline has already received sanction from one of the West Asian banks for $150 million ECB for which Jet has approached the RBI for its nod, he said.

Abu Dhabi-based Etihad Airways invested Rs 2,057 crore for a 24 per cent stake in the Naresh Goyal-led carrier in November last.
     
The proceeds from the two ECBs and some other low-cost loans raised from the Indian market will help the airline pare its high cost debt, Gopalakrishnan said, adding, "we should be significantly in a better position at the end of March."

He said the airline has been able to reduce its debt by Rs 1,600 crore through the funds received from Etihad.

Jet's debt came down to Rs 10,895.2 crore in the December quarter as against Rs 12,494.7 crore in the July-September period, he said.

Jet had last week reported a net loss of Rs 267.89 crore for the three months to December on account of rising expenses due to high fuel prices and rupee depreciation.

The airline had registered a net profit of Rs 85 crore in the year-ago period while it had reported a net loss of Rs 891.01 crore in the three months to September.