Jet Airways cancels all flights after rescue talks fail

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Indian carrier Jet Airways has temporarily cancelled all flights after talks to rescue the struggling carrier failed and it looks like being the latest airline to fall by the wayside.

In a letter to the Bombay Stock Exchange in Mumbai, the company said: “Late last night, Jet Airways was informed by the State Bank of India (SBI), on behalf of the consortium of Indian lenders, that they are unable to consider its request for critical interim funding.

“Since no emergency funding from the lenders or any other source is forthcoming, the airline will not be able to pay for fuel or other critical services to keep the operations going.

“Consequently, with immediate effect, Jet Airways is compelled to cancel all its international and domestic flights. The last flight will operate today.

“The decision has been taken after a painstaking evaluation of all alternatives that were made available to the company and after receiving guidance and advise on the same from its board of directors. Jet Airways has informed the DGCA and the Ministeries of Civil Aviation and Finance and other relevant government institutions, of this course of action.

“Over the last several weeks and months, the company has tried every means possible to sek both interim and long-term funding. Unfortunately, despite its very best efforts, the airline has been left with no other choice today but to go ahead with a temporary suspension of flight operations.

“This has been a very difficult decision but without interim funding, the airline is simply unable to conduct flight operations in a manner that delivers to the very reasonable expectations of its guests, employees, partners and service providers.”

Earlier this week Jet Airways extended its suspension of international services to Thursday (18 April) from the previous 15 April. It was only operating a fleet of seven aircraft on domestic flights over the last few weeks.

Earlier this year it had a fleet of 120 aircraft, but lessors have taken aircraft back due to money owed. The airline owes $1 billion.

The Indian carrier had issued no fresh news on the R15 billion ($215 million) interim loan facility that it had announced on 25 March.

The airline was taken over by the banks in March and an expression of interest process seeking proposals for a new investor to take a controlling stake in the airline was closed. That process is set to be finalised on 10 May after expressions of interest were received.