Aviation

Synergy Group looks to acquire 49% stake in Jet Airways, says report

Updated : August 29, 2019 09:36 AM IST

The company, which owns a majority stake in Avianca Airlines, South America’s second-largest airline, submitted an expression of interest (EOI) last week for Jet Airways, the report said.

German Efromovich, the founder of Synergy Group, is expected to visit India next month to discuss viable investment options, it added.

In April this year, the Naresh Goyal founded Jet Airways shut its operation due to severe cash crunch. The airline has a debt of Rs 8,500 crore.

Synergy Group looks to acquire 49% stake in Jet Airways, says report

South America's Synergy Group Corp is eyeing 49 percent stake in Jet Airways, reported Business Standard. The groupâ€™s advisor told the paper that the company will discuss co-investment options with its lenders and infrastructure companies.

The company, which owns a majority stake in Avianca Airlines, South Americaâ€™s second-largest airline, submitted an expression of interest (EOI) last week for Jet Airways, the report said.

German Efromovich, the founder of Synergy Group, is expected to visit India next month to discuss viable investment options with Jet's lenders and infrastructure companies, the report added. As per government norms, substantial ownership must lie with Indian citizens.Â

â€œWe intend to structure the acquisition as a foreign company with a 49 percent stake. Jet Airways is publicly listed and we hope lenders would be willing to convert their debt into equity. We will also discuss partnerships with Indian infrastructure companies. We have several options,â€ Antonio Guizzetti, president of consultancy G&A, which is advising the Synergy Group regarding the stake buy, was quoted as saying in the report.

In April this year, the Naresh Goyal founded Jet Airways shut its operation due to severe cash crunch. The airline has a debt of Rs 8,500 crore. The resolution professional on the airline's insolvency proceedings, Ashish Chhawchharia, has received creditor claims of over Rs 30,000 crore and admitted claims of around Rs 12,000 crore, the report added.

â€œThe amount of investment by the Synergy Group will depend on discussions and negotiations with banks and other creditors. In insolvency cases, it is common to negotiate for a discount on debt,â€ he told BS.

Efromovich bought Avianca when it was undergoing bankruptcy proceedings in 2004 and transformed into the second-largest airline in South America, the report mentioned.

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