Jet Airways promoter defends Sanjiv Kapoor’s appointment as CEO-designate

Jet Airways CEO-designate Sanjiv Kapoor

Jet Airways promoter Jalan-Kalrock consortium (JKC) shot off a letter to monitoring committee head Ashish Chhawchharia on January 10, defending the appointment of Sanjiv Kapoor as CEO-designate of the airline.

The letter was in response to Chhawchharia sending a notice to Kapoor, objecting to his designation as CEO of Jet Airways and asking him to not make any statements on behalf of the carrier, which is yet to be handed over to JKC, the successful bidder.

The consortium asked Chhawchharia to share a copy of the minutes of the meeting of the monitoring committee in which the matter was discussed and a resolution taken to issue a letter to Kapoor on December 28, asking him to refrain from using the title of CEO.

“Sanjiv Kapoor, who received necessary security clearance from the Honourable Ministry of Civil Aviation, Govt of India, in August 2022 is the CEO-Designate for Jet Airways and thus requires no further approval from any statutory authority,” JKC said in the letter.

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Kapoor, the former chief operations officer of SpiceJet and Vistara, was appointed by JKC in March 2022.

Consortium’s employees

It clarified that Kapoor and other employees working for Jet Airways are on the payrolls of JKC, the successful resolution applicant (SRA), and will transition to the airline after ownership is transferred to the consortium.

Until the transfer of ownership, “Kapoor along with all remaining employees on the payrolls of SRA shall continue to work for the benefit of Jet Airways and its successful revival,” JKC said in the letter.

The consortium asked Chhawchharia to remain within the ambit of his powers.

JKC said in the letter that it “seeks constructive support from all stakeholders including you” and added, “You are advised to refrain from communicating on behalf of Jet Airways until authorised by all required members of the committee. Thus, as authorised representative of the committee, you are requested to act on matters which are authorised or otherwise approved by the MC jointly.”

The consortium told Chhawchharia that if “there exists no resolution which authorises you to write to Kapoor, your letter under reference shall be considered null and void.”

Chhawchharia is a partner and head of restructuring services at Grant Thornton Bharat. He was appointed as the resolution professional to oversee the airline’s affairs during the insolvency process.

Chhawchharia is a non-voting member of the MC, which also consists of three voting members selected by the lenders and three voting members chosen by JKC.

Jet Airways was grounded in April 2019 over piling losses and debt of about Rs 8,000 crore. A consortium of London-based Kalrock Capital and UAE-based entrepreneur Murari Lal Jalan emerged as the successful bidder in the airline’s insolvency resolution process.

Also read: Jet Airways revival hits new snag as banks push back on funding

However, the airline’s revival hit a hurdle after the National Company Law Appellate Tribunal directed the consortium on October 21 to pay the provident fund and gratuity dues of employees until June 2019, when the insolvency process started.

The consortium told the NCLAT that clearing the dues amounting to about Rs 250 crore was not part of its original resolution plan that was approved by the National Company Law Tribunal.