Jet shares rise on report that airline has secured $293-mn loan from PNB

Shares of Jet Airways Ltd rose as much as 4.8 per cent to Rs 255, the highest in over a month, after a report said the debt-laden carrier has secured a loan of Rs 20.50 billion ($293.07 million) from the Punjab National Bank (PNB).

The airline has raised foreign currency term loans worth Rs 11 billion and a non-fund based credit facility of Rs 9.50 billion from PNB, according to copies of loan documents reviewed by Indian daily Mint.

Jet and PNB did not immediately respond to a request for comment.

The loan documents mention that Jet will use the credit facility for its working capital needs, but the money would be mainly used to pay rental dues to aircraft lessors and salary arrears, Mint reported, citing a source familiar with the matter.

 

Jet said last week another three aircraft had been grounded due to its failure to make payments, taking the total number to 28, but it has not specified the lessors involved.

The airline has an option to sell down as much as Rs 2.50 billion of the term loan to other investors, Mint added.