Jet Airways creditors may recover only a fraction of total dues if liquidated

Jet Airways’ frustrated creditors are only likely to get a small fraction of the money they are owed if the airline is finally wound up.

The bankrupt airline only has about US$300-400 million in usable assets, which is less than 10% of its debt which is estimated at US$4.2 billion.

"The expected recovery on owned planes and real estate is US$300-400 million after repaying debt tied specifically to those assets," a person familiar with the bankrupcy resolution process told Reuters.

The airline only has a few owned planes and some real estate assets.

Most of its 100-plus aircraft fleet was repossessed by lessors which led to its eventual grounding earlier this year.

It finally ran out of cash in April.

The airline has more than 2,000 creditors which includes vendors, suppliers and employees still awaiting salaries.

There is hope it can still be sold off in part or full to maximize payments to creditors but will still likely fall well short of its total debts.

Three foreign companies made expressions of interest to take over the business and two of these have now been shortlisted.

However there is no certainty either of these will ultimately become the new owner due to India’s complex foreign ownership rules.