For Jet-II to take to the skies again, London-based Kalrock Capital and UAE businessman Murari Lal Jalan will need to infuse Rs 350 crore within 180 days followed by another Rs 250 crore in the next six months — a total Rs 600 crore in the first year.
This successful resolution applicant (SRA) will need to infuse through ECB Rs 175 crore in the second year, followed by another Rs 600 crore later on.
In all, the SRA has “proposed a total cash infusion of Rs 1,375 crore,” says the National Company Law Tribunal’s (NCLT) detailed order for the airline’s revival plan that made available on Wednesday.
Settlement of claims from this amount made on Jet-I will be limited to Rs 475 crore. While Jet’s financial creditors had raised total claims of Rs 7,808 crore, the consortia has proposed to pay Rs 385 crore to them — 95% less.
Though raising hope for the airline to fly again, there is as of now not much good news for Jet-I employees.
“Corporate debtor (Jet-I) currently has large number of employees and workmen on its payrolls, who are otherwise not required for the day-to-day affairs hence the resolution professional did not account the salaries and other benefits due to such employees (estimated at about Rs 715 crore as of September 2020) as corporate insolvency resolution process cost,” the order states.
The SRA’s proposal for the employees, that needs to be approved of by the latter, includes creating a welfare trust that will get 0.5% equity stake in the revived airline.
“The SRA estimates that the NPV of 0.5% equity stake.. at year 5 is (estimated at) Rs 183 crore.” The trust can then sell these shares and pay employees.
“Cash payment for employees: SRA proposes to pay a token sum of Rs 11,000 in cash to each employee of (Jet-I); Rs 5,100 cash as medical expense reimbursement for the parents of the workmen; Rs 5,100 as school fee reimbursement for children of workmen; Stationary (notebooks, school bags etc) valued at Rs 1,100 for children of the workmen (and) one-time mobile phone recharge of Rs 500 for workmen.”
These cash payments “will be made out of the contingency fund (Rs 8 crore) reserved by the SRA. Additional amounts, if required, will be utilised out of the proceeds of sale of assets,” the order says.
The SRA proposes to retain 50 employees and workmen forming part of the asset preservation team (APT). “It is submitted in the resolution plan that the RP has estimated an approximate sum of Rs 240 crore (as of 31.08.2020) towards parking charges for aircrafts and airport space lease charges, during the CIRP as good faith estimates.”
(With inputs from agencies)