Facing pressure from banks after default, Naresh Goyal back at deal table

But given the liquidity crunch that has already forced it to delay salary payments, Jet Airways has defaulted on payments due December 31. In a letter to the Bombay Stock Exchange on January 1, the airline revealed it had defaulted on interest and principal instalment due to "temporary cashflow mismatch."

The negotiations

The talks with Tata Sons got stuck over a non-compete clause that Goyal didn't agree to. Sources had earlier told Moneycontrol that Goyal wanted to keep JetLite, the low-cost arm of Jet Airways, out of the deal.

The Tatas are keen to leverage on Jet Airways to scale up Vistara, their joint venture airline with Singapore Airlines.

"The Tatas will come in only if they have complete control... It is increasingly coming to a stage where Goyal may have to give up control," said a senior executive from an airline.

Goyal holds 51 percent stake in the airline.

Air pockets

The default on debt repayments may have a serious impact.

According to the norms of Reserve Bank of India, banks need to initiate resolution proceedings against a company within 180 days of default.

Jet Airways can escape that ignominy by raising funds and soothing its lenders' nerves. State Bank of India is its lead lender. A report by PTI in December said the airline is in talks with the bank for an Rs 1,500-crore loan for which the guarantee will come from Etihad.

Apart from the guarantee, the Abu Dhabi-based airline is also considering a request from Jet Airways for a soft loan of $150-$300 million. Earlier this year, Etihad had paid Rs 258 crore to Jet as an advance payment for the Indian carrier's loyalty programme.

"Getting an investor is important for Goyal, as the backing of investors will help him convince banks to loosen their purse strings," said another executive from the industry.