Jet Airways founder agreed at step down as board decided to give away majority shares to lenders.

Loss-making Jet Airways board agreed to give majority (50.1%) stake for its lenders.

The board will allot 11.4 crore shares at an aggregate value of Re 1 to the lenders’ consortium led by State Bank of India whereby lenders will convert debt into equity at Rs 1.

The conversion will bring down the founder Naresh Goyal and Etihad Airways’ stake by half to 25 percent and 12 percent, respectively. Mr. Naresh Goyal agreed to step down from the board as chairman.

Jet Airways Airbus A330 | image courtesy: respective owners

The company called an extraordinary general meeting on Feb. 21 for shareholder approval for issue of additional shares.

The airline, which has a debt of over Rs 10,900 Cr, defaulted on repayments and struggled to pay salaries as higher fuel prices and low fares in a competitive market left it short of cash.

News source : News-in-flight