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Jet Airways' Boeing 777 plane held by Dutch sold for $9m to close insolvency process

Dubai - The bankrupt airline's revival plan is gaining momentum

Jet Airways, which has been in the process of a revival after being grounded for more than two years, announced that one of its wide-body Boeing 777 aircraft under the custody of the Dutch administrator has been sold for $9 million.

In a regulatory filing on Saturday, the airline said the proceedings would mainly be utilised to close the insolvency process against it the Netherlands that now stands concluded after the sale.

The bankrupt airline's revival plan has been gaining momentum after India's top bankruptcy court had approved the move under an owners' consortium. The consortium was formed by the UAE-based entrepreneur Murari Lal Jalan and Kalrock Capital, who won the bid to revive the debt-ridden Jet Airways in October 2020.

The court cleared the consortium's proposal to revive the airline on June 22. While the airline had admitted claims of around Rs150 billion, the consortium has offered to settle claims of Rs4.75 billion of financial and non-financial creditors

Already, the airline's creditors have taken an almost 95 per cent haircut under the resolution plan. The owners' consortium has proposed to pay Rs3.85 billion against claims of Rs78.08 billion raised by its financial creditors.

Jet Airways was declared bankrupt in the Netherlands in response to a complaint by two European creditors. Thereafter, as per the Noord-Holland District Court order on May 21, 2019, insolvency proceedings were initiated against the airline.

Rocco Mulder was appointed as Dutch administrator in the insolvency proceedings to manage the estate of Jet Airways in the Netherlands. He took custody of the company's assets in the country on the date of initiation of insolvency proceedings, which included one Boeing 777-300ER aircraft parked at Schiphol Airport.

"This is now to inform that as per the information received from the Dutch Administrator, the equipment under the custody of the Dutch Administrator has been sold to IAGCAS 777, LLC, for $9 million under the Dutch Insolvency Process," Jet Airways Monitoring Committee-authorised representative, Ashish Chhawchharia, said.

The sale of aircraft is as per the terms of the protocol, where under it is agreed that the proceeds from the sale of equipment will be first utilised for the closure of the Dutch Insolvency Process in Netherland to ensure that the company is no more declared insolvent.

Balance funds, if any, shall be repatriated to India, and shall be dealt as per the provision of the Insolvency and Bankruptcy Code, the filing added.

The Dutch Administrator took custody of the assets of Jet Airways in the Netherlands on the date of initiation of insolvency proceedings which included one Boeing 777 300 ER aircraft (VT-JEW) parked at Schiphol Airport, the company said.

Further, as per the direction of the National Company Law Appellate Tribunal, Cross Border Insolvency Protocol was agreed between Ashish Chhawchharia (erstwhile resolution professional of Jet Airways) and Mulder, which NCLAT approved through its September 26, 2019, order, Jet Airways said.

"We wish to further inform that subsequent to the sale of the equipment and after completing the requisite formalities, the Dutch Insolvency Process shall stand concluded," Jet Airways said in the filing.

- issacjohn@khaleejtimes.com