Naresh Goyal resigns from Jet Airways following emergency board meeting

Naresh Goyal resigns from Jet Airways following emergency board meeting

Troy Powers
March 26, 2019

Air India's current CMD, Ashwani Lohani is likely to get additional charge to oversee troubled Jet Airways' daily operations, according to Zee Media sources.

Founder and chairman Naresh Goyal owns a 51% stake in Jet Airways, along with his wife, Anita, who is also on the airline's board.

Banks have moved in to take control of the airline after Jet failed to convince investors, including its largest shareholder Etihad Airways, to invest more money.

Jet said said there will be immediate funding support by lenders for the cash-strapped airline.

Saving Jet is crucial for Indian Prime Minister Narendra Modi as he looks to avoid thousands of job losses ahead of a general election.

This is part of the resolution plan put in place by a consortium of domestic lenders led by State Bank of India.

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The lenders will nominate two directors to the Jet board and will shortly initiate an auction process to find a new strategic investor for the company.

State Bank of India has reportedly agreed to infuse ₹15 billion into the private carrier.

The airline has not paid salaries to a section of its employees, including pilots.

As part of the bailout plan, lenders will start a bidding process to sell their stake in the airline to a new investor.

"Today is indeed a sad day for Indian aviation", said Ajay Singh, chairman and managing director at rival SpiceJet, adding that Goyal and Anita made India proud by launching a "world class" airline.

The banks, led by State Bank of India (SBI), will convert their debt into equity and take a controlling stake in the airline for a token sum of 1 rupee ($0.0145), Jet said in a statement to the stock exchanges after its board met earlier on Monday. This has all been possible because of the tireless, unrelenting efforts of each and every one of you, tight-knit members of our Jet Airways family, setting guest-service benchmarks to the envy of our competitors, helping us collectively realise our dream of our Jet Airways emerging as a global gold standard of warm Indian hospitality", Goyal says, adding "Looking back I would not want to change a thing.