UAE’s Etihad hires turnaround expert Alvarez & Marsal as it weighs Jet Airways bailout

Jet Airways, which controls a sixth of India’s booming aviation market, desperately needs a bailout. (File photo: Reuters)
Updated 27 January 2019
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UAE’s Etihad hires turnaround expert Alvarez & Marsal as it weighs Jet Airways bailout

NEW DELHI/ABU DHABI: Etihad Airways has appointed turnaround specialist Alvarez & Marsal to conduct due diligence on Jet Airways Ltd. as it weighs bailing out the cash-strapped Indian carrier, three sources familiar with the matter told Reuters.
Executives from Alvarez & Marsal are camped in Jet Airways’ offices in Mumbai and are taking stock of the airline’s operations and looking into its financial health and records, one of the sources said.
The Abu Dhabi-based carrier plans to raise its stake in Jet Airways from the current 24 percent but it wants the airline’s founder and chairman Naresh Goyal to give up control, sources have told Reuters.
“Alvarez & Marsal are restructuring consultants. If they are there it means they are looking for stuff to cut,” said a second person who is familiar with the matter.
An Etihad spokeswoman declined to comment. Alvarez & Marsal did not immediately respond to an email seeking comment.
Jet Airways did not respond to an email seeking comment but said last week it is in talks with lenders to resolve its debt problems. It is seeking a cash injection by stakeholders and will make board changes.
Jet Airways, which controls a sixth of India’s booming aviation market, desperately needs a bailout. High fuel taxes, a weak rupee and price competition have squeezed profitability, leaving the airline with net debt of $1.13 billion.
Earlier in January it defaulted on a debt payment to a consortium of banks, led by State Bank of India (SBI), prompting ratings agency ICRA to downgrade the carrier.
The airline also owes money to employees, vendors and lessors — some of whom are considering taking back aircraft, sources have told Reuters.
Jet Airways brought on board two global consultants last year who also have people working out of the airline’s office in Mumbai, the first source said. McKinsey is helping with cost-cutting efforts and Boston Consulting Group (BCG) is looking at ways to increase revenue, he added.
McKinsey did not respond to an email seeking comment. BCG said it would not comment on any company specific matters.
Representatives of both airlines met with creditors, led by Jet’s biggest lender SBI, in Mumbai last week to discuss a proposal that involves Etihad increasing its 24 percent stake, a source told Reuters.
The Abu Dhabi carrier can go up to a maximum of 49 percent according to India’s foreign ownership rules for airlines. Also, if it breaches the 25-percent mark it must adhere to strict capital markets rules.
The markets regulator, Securities and Exchange Board of India (SEBI), said on Thursday it had not yet expressed any “view” on giving such a concession to Jet or Etihad.


Fraudsters exploit interest in Libra digital currency

Updated 23 July 2019
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Fraudsters exploit interest in Libra digital currency

  • Fake Libra opportunities or offerings have popped up on Facebook and Instagram
  • Criminals routinely seize on hot topics to try to dupe people online
SAN FRANCISCO: Fraudsters are out to cash in on interest in Facebook-backed digital currency Libra, hawking bogus buying opportunities at online venues including the social network itself.
Libra is to launch next year, overseen by an association based in Europe, but as with other hot topics it has been seized on by nefarious characters intent on tricking people with false accounts, pages, and information.
Fake Libra opportunities or offerings have popped up on Facebook’s main social network and its image-centric online community Instagram, according to a report Monday in the Washington Post.
A number of Libra-themed deceptive accounts were removed from the Facebook platform after the California-based company was alerted by the Post, according to the publication.
Some of the fake accounts used the official Facebook logo and photos of chief executive Mark Zuckerberg.
“Facebook removes ads and Pages that violate our policies when we become aware of them, and we are constantly working to improve detection of scams on our platforms,” the Internet titan said in response to an AFP inquiry.
The Libra Association was reported to be working with Facebook to get deceptive pages about the currency deleted.
Criminals routinely seize on hot topics to try to dupe people online, from natural disasters and major tragedies to celebrity news.
A buylibracoins.com website accessible Monday offered a fake chance to buy the digital currency, encouraging potential victims to share contact details of friends in a referral program.
Fraudsters were said to be setting also hunting for victims at other online venues such as Twitter and YouTube.
The rise of fake Libra offerings comes as Facebook tries to dispel worries and build trust in what it hopes will be a global currency that gives life-changing financial tools to people around the world.
G7 finance ministers and central bankers last week dealt a blow to Facebook’s planned new cryptocurrency Libra, issuing a barrage of warnings about its dangers for the global economy at a two-day meeting outside Paris.
Facebook in June unveiled its plans for Libra in an announcement greeted with concern by governments and critics of the social network behemoth, whose reputation has already been tarnished by its role in spreading fake information and extremist videos.
Ministers from the Group of Seven (G7) major global economies “agreed that projects such as Libra may affect monetary sovereignty and the functioning of the international monetary system,” France, the current G7 chair, said in a statement.
It said projects like Libra with a “global and potentially systemic footprint... raise serious regulatory and systemic concerns, as well as wider policy issues, which both need to be addressed before such projects can be implemented.”
US Treasury Secretary Steven Mnuchin said his concerns about Libra and other cryptocurrencies — which he had made clear in White House news conference this month — were shared by G7 counterparts.
Libra is widely regarded as a challenger to dominant global player bitcoin. Expected to launch in the first half of 2020, Libra is designed to be backed by a basket of currency assets to avoid the wild swings of bitcoin and other cryptocurrencies.