Naresh Goyal of Jet Airways
Naresh Goyal of Jet AirwaysReuters

A lenders' consortium may become the largest shareholding group in debt-laden private carrier Jet Airways even as a clarification from the airline failed to steady the shares, media reports say.

Talks between the lenders and the airline have entered the final stage, sources say, indicating that the consortium may hold as much as 40 per cent of the airline's equity.

The company led by Naresh Goyal, meanwhile, issued a statement to clarify that there had been no proposal from foreign partner Etihad Airways to buy the company's stocks at a discounted Rs 150 a share, much below the 52-week low of Rs 162.80. Media reports suggesting such a proposal on Wednesday saw the share fall 7.95 per cent to close at Rs 269. The clarification helped the share gain Rs 16.70 by Thursday noon to touch Rs 289, but remained volatile.

The airline confirmed that the resolution plan was considering various options on the debt-equity mix, proportion of equity infusion by stakeholders and the consequent change in the composition of the company's board of directors.

Sources suggest that in the proposal that has reached the final stage of discussion, Etihad's stake could go up by 2 per cent to 3 per cent. Founder chairman Goyal's stake could possibly fall to around 24 per cent from the current 51 per cent and Etihad 24 per cent.

Regarding the sticky issue of the necessity of a mandatory open offer to shareholders, sources say a restructuring of the debt-equity mix could provide a way around the issue as Goyal would cease to be classified as the promoter with the dilution of his holding. This situation would make the company eligible for an exemption as was done in the case of another private airline. Only the Securities and Exchange Board of India (Sebi), can take a decision on such an exemption, according to the source.

A restructuring would involve the lenders taking a few seats on the board. Goyal may also have to guarantee to restructure of the company's overseas bonds.

Ernst & Young is yet to complete a forensic audit of the company. People in the know say the audit is not on the trail of any major criminal offence in relation to funding but may have uncovered minor diversions that need rectification.

UAE national carrier Etihad had placed some stiff conditions for the bailout, including Goyal's exit from the control and right to appoint a CEO in return for fresh capital infusion. It also sought waivers of the open offer and preferential allotment norms. These conditions were attributed to a letter Etihad CEO Tony Douglas addressed to the SBI.

Jet is facing a loan repayment of Rs 1,700 crore due by March end, including Rs 1050 crore loan raised from various banks in the Middle East in 2014.