Jet Airways’ founder Naresh Goyal is stepping down as chairman of the cash-strapped airline after reportedly agreeing a bailout deal with major shareholder Etihad Airways.
Goyal’s 51% majority stake will be reduced to 22%.
Etihad’s stake would go up to 40% from the current 24%, as the airlines look set to sign a memorandum of understanding (MoU) within the next few days, according to the Business Standard newspaper.
Jet Airways’ lenders would also convert debt to equity and combined would own about 30% of the airline.
The airline is saddled with debt of more than $1 billion and has been struggling to pay salaries on time.
CEO Vinay Dube said a resolution to its troubles in principle is ‘very close.’
"Our chairman, the board of directors and your management team are working hard on a balance sheet transaction that will help us eliminate our current challenges," Dube said in a letter to staff which was seen by Reuters.
The airline’s board hopes to finalise all the formalities of the deal at a meeting next month and if Etihad’s conditions are met it will immediately invest an additional $35 million.
