Naresh Goyal as chairman Jet Airways: Will new stakeholders be able to get beleagured airline off ground?

Jet Airways sliding to Number 2 rank in the Indian aviation space on a standalone basis explains some of the rationale that seems to have played on Naresh Goyal while agreeing to step down as Chairman of the beleaguered airline to give a new lease of life to an airline which has survived many rough patches despite a string of troubling legacy issues.

Goyal’s exit comes at a time when options to find a cure for the financial challenges for Jet were running out rapidly with further bank loans out of reach and new investors not responding adequately to Goyal’s reach-outs, swiftly pushing the airline to the present situation.

The provisional resolution plan providing for lenders to become largest shareholders following conversion of debt into shares underlines the dilemma and compulsion for both, Goyal as well as the shareholders.

While the lenders have been continuously working on steps to recover the debt from Jet, the toss-up for lenders was to either push the airline into a resolution process by initiating proceedings before National Company Law Tribunal (NCLT) or to rework the debt to enable Jet to tide over the crisis.

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