Jet Airways founder Naresh Goyal to quit as chairman today

Jet Airways founder Naresh Goyal to quit as chairman today

Chief Executive Vinay Dube is expected to stay on board the 25-year-old airline Goyal set up with his wife in 1993. "No body is barred from bidding or taking over the airline as per the rule", he said. His government urged state-run banks to rescue the airline without pushing it into bankruptcy, sources have told Reuters.

Jet Airways, which is facing a severe cash crunch, defaulted on a domestic loan repayment in December.

Jet will use the money to partly clear dues owed to lessors, vendors, creditors and employees in a phased manner, the airline said in a separate statement.

At one point, Jet Airways was operating only 41 out of the 119 aircraft in its fleet.

The statement, filed by the airline, said Naresh Goyal, wife Anita Goyal and director Kevin Knight resigned on Monday and two nominee directors were inducted by the lenders. "I am happy with this decision".

Joint venture partner Eithad's stake will be brought down to 12 percent from 25 percent and Naresh Goyal will now hold 25 percent, Kumar said.

A bidding process will be initiated for new investors, which is expected to be completed in the June quarter.

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According to the Reuters report, the government had also nudged it's the National Investment and Infrastructure Fund (NIIF) - created to invest in infrastructure projects - to buy a stake in Jet.

Jet Airways has survived a near-death experience once before; in 2013, Abu Dhabi's Etihad Airways injected $600 million of capital for a 24 percent stake in the airline, three London Heathrow slots and a majority share in its frequent flyer programme.

But competition from low-priced carriers, such as IndiGo and SpiceJet Ltd, together with high oil prices, hefty fuel taxes and a weak rupee piled on the pressure in recent months.

Jet Airways share price has been gaining for the last two days and has risen 6.93% during the period.

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

Jet said its board has also approved the constitution of an interim management committee at the request of the lenders to manage and monitor the daily operations and cash flow of the company. "We urgently need to address structural challenges that make India's airlines uncompetitive to airlines around the world".

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