April 7, 2019 / 9:34 AM / in 6 months

Stake sale in troubled Jet Airways may get delayed: newspaper

A Jet Airways plane is parked as another moves to runway at the Chhatrapati Shivaji International airport in Mumbai, February 14, 2018. REUTERS/Danish Siddiqui/Files

NEW DELHI (Reuters) - Lenders to India’s troubled Jet Airways Ltd may have to wait a little longer to sell a stake in the carrier, as they need more clarity from the Reserve Bank of India (RBI), the Business Standard newspaper reported on Sunday.

Jet, India’s oldest private carrier, is saddled with more than $1 billion in debt, compounding its financial woes and forcing it to ground most of its fleet.

After Jet failed to convince potential investors, including its largest shareholder Etihad Airways, to bail it out, Indian banks decided to take a majority stake in the carrier.

Last month, Jet’s lenders, led by State Bank of India agreed to bailout the airline in a complex deal that involved the banks taking a majority stake, while seeking out an investor to help revive the company’s fortunes.

Jet’s lenders on Thursday said they plan to seek expressions of interest in the airline from potential investors from April 6 and that all submissions from interested parties are expected to be completed by April 9.

But this process may be delayed as RBI is yet to examine the issue of debt to equity conversion, the paper said, citing a source.

In February, Jet said its shareholders had approved a plan to convert its existing debt to equity.

Reporting by Mayank Bhardwaj; Editing by Kim Coghill

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