India's Directorate General of Civil Aviation (DGCA) has granted Jet Airways (JAI, Mumbai International) an interim air operator's certificate (AOC) "for the limited purpose of completing the ongoing corporate insolvency resolution process."
The permit, reissued on July 28, is valid until September 3, 2023. The grounded carrier's previous AOC lapsed in May. September 3 is also the new deadline for the nominal new owners of Jet Airways, the Jalan Kalrock Consortium (JKC), to start meeting their side of the approved resolution plan. Before the start of September, Jet Airways will also have to undergo re-certification per India's air operator certification procedures and demonstrate compliance with all the applicable regulatory requirements. The National Company Law Tribunal (NCLT), which is overseeing the ownership transfer process, also expects a coherent business plan detailing how the consortium intends to restart the airline by the September deadline. Nonetheless, the interim AOC is widely interpreted as a sign of confidence from the DGCA concerning Jet Airways' prospects.
JKC says securing the AOC, even for a short period, demonstrates their commitment to reviving "India's most admired airline." Under its former owners, Jet Airways collapsed in April 2019, leaving creditors almost INR80 billion Indian rupees (USD972.6 million) out of pocket. Under the terms of the NCLT-approved resolution plan, those creditors would allow JKC to acquire the airline in exchange for INR4.75 billion (USD57.7 million). However, the relationship between lenders and the consortium has deteriorated into a legal quagmire, and the resolution plan has yet to progress.
In a statement, JKC says it "remains fully dedicated to the revival of Jet Airways, and is committed to implementing a comprehensive strategy to ensure the airline's success. JKC will continue to work closely with all relevant authorities, industry partners, and stakeholders in reviving Jet Airways in the coming weeks."
Lenders, led by the State Bank of India, have recently begun pushing for Jet Airways' liquidation and the sale of its remaining assets, saying this is their only hope of recouping any funds. However, JKC has resisted this, saying they have sufficient funds on hand to relaunch the airline and pay the creditors per the agreed-upon 2021 resolution plan terms. In its statement announcing the interim AOC this week, JKC said it was "well capitalised and led by seasoned industry professionals."
