Jet Airways shares took a flight on Wednesday, reaching 5% of the circuit above Rs 104 each on ESB, as the Kalrock-Jalan consortium receives a nod to operate the airline again. Shares of the now defunct airline rose 15.6% in 3 trading sessions, compared to a 1% gain for the first S&P BSE Sensex.
On Tuesday, the National Company Law Tribunal (NCLT) cleared the resolution plan submitted by the consortium, paving the way for the restart of the airline that has been out of business since 2019. The consortium will now seek the relevant government approvals before it can resume the operations.
According to a Commercial standard report, the new management of the airline will have to appoint key executives in the fields of engineering, flight safety, operations and security. It will also have to update all operations manuals and submit to a regulatory audit before obtaining authorization to start operations.
“The consortium selected Sudhir Gaur, former head of operations and training for Jet Airways, and a few other executives in senior operational positions. Gaur worked with Nepal Airlines after Jet’s shutdown. With the adoption of the resolution plan, the Insolvency Jet process came to an end. From now on, an oversight committee, made up of representatives of the banks, the consortium and resolution professional Ashish Chhawchharia, will oversee the operation of the company for the next 90 days, ”the report said. READ HERE
While the consortium will be responsible for negotiations with airports and suppliers, the committee will function as a quasi-council and take care of all company actions and compliances, he added.
The airline’s new board of directors will take over on the effective date which has been set at 90 days from the order being placed on Tuesday. The consortium will also have to pay a performance bank guarantee of around Rs 100 crore and meet other conditions.
Other shares in aviation, InterGlobe Aviation and SpiceJet were trading both ways. The former was up 0.08% at 9:50 a.m., while the latter was down 0.7%. The benchmark Sensex, meanwhile, was up 0.13%.