Indian conglomerate Hinduja Group said on Tuesday it is evaluating a possible bid for debt-laden Jet Airways Ltd, sending shares of the grounded carrier as high as 14% in afternoon trading.
The company was responding to a Reuters request for comment after the Economic Times newspaper said the group would start the process of bidding this week.
Hinduja Group is in talks with Jet founder Naresh Goyal and investor Etihad, besides talking to investment bankers led by SBI Capital Markets for due diligence, ET report said, citing sources.
SBI Capital Markets declined to comment, while Etihad did not respond to a Reuters query.
Jet Airways, once the biggest private carrier in the country, owes vast sums to its lessors, employees, fuel suppliers and other parties. It stopped all flights from April 17 after its lenders refused to give it any more funds to keep the carrier flying.
The Indian carrier, which is also saddled with roughly $1.2 billion in bank debt, was crippled by mounting losses as it attempted to compete with low-cost rivals Interglobe-owned IndiGo, SpiceJet Ltd and Wadia Group-owned GoAir.
For months, Jet has tried to convince investors, including Etihad, to pump in money and save the airline. However, suitors had some qualms, while a deadline for any interested parties to submit binding bids for the carrier ended on May 10.
State Bank of India (SBI), Jet’s lead lender and the bank overseeing the sale process, earlier said it had only received three conditional offers, including one from Etihad.
Etihad, which already holds a minority stake in Jet, is interested in re-investing in the airline, subject to certain conditions, a spokesman for the Middle Eastern carrier had said, adding that it cannot be the sole investor.
The airline has been rapidly shedding aircraft in recent weeks, as lessors have rushed to deregister and repossess planes in the wake of the turmoil. It has also seen the exit of its chief executive and several other senior officials, lost hundreds of pilots, cabin crew and engineers to rivals and seen its valuable slots reallocated to rivals, making the rescue of the debt-laden carrier much tougher for a new investor.
Jet’s shares were trading 14% higher at 149.70 rupees at 0925 GMT in an otherwise weak Mumbai market.