MUMBAI: The Jet Airways board became dysfunctional on Friday after Etihad Airways’ representative Robin Kamark resigned, the fourth director to quit in less than a month, leaving it with only two members.
The board of a publicly-listed company requires a minimum of three members, according to capital market norms. The grounded airline announced Kamark’s exit in a filing to the exchanges, saying it was effective April 16.
Kamark’s departure comes as Jet faces two regulatory probes while its lenders look for investors to save the airline. To be sure, a new board will be formed if Jet finds investors.
Etihad owns 24 per cent of Jet and is entitled to two board seats. Kevin Knight, its other representative, resigned on March 25, along with founder Naresh Goyal and his wife Anita Goyal. Jet announced the resignation of whole-time director Gaurang Shetty on May 9. Two independent directors — former bureaucrat Nasim Zaidi and businesswoman Rajshree Pathy — had resigned in April. The board now has former bureaucrat Ashok Chawla and banking veteran Sharad Sharma.
On May 14, CEO Vinay Dube, CFO Amit Agarwal, Chief People Officer Rahul Taneja and Company Secretary Kuldeep Sharma, resigned from the company.
Subsequently, Raj Sivakumar, senior vice president for network and revenue management, as well as Ravichandran Narayan, senior vice president — finance, left.
“Because most of the Indian directors had resigned, and with the resignation of key management personnel, Robin Kamark, being a foreigner, did not feel comfortable continuing on the board,” said a source familiar with the development.
The Enforcement Directorate, the finance ministry’s economic law enforcement agency, is probing Jet’s sale of 50.1 per cent of its loyalty rewards programme Jet Privilege to Etihad. The Serious Fraud Investigation Office (SFIO) of the corporate affairs ministry is looking into alleged irregular transactions by Goyal.
“The resignation does raise some questions. Whichever direction Jet takes, he could have remained on the board till some clarity emerged.” said Ramesh Vaidyanathan, managing partner at Advaya Legal, a Mumbai-based law firm. “Also, let’s not forget Jet is facing regulatory probes and most directors have resigned. It wouldn’t reflect well on anyone individually to remain.”
The regulators will likely give Jet a long rope, given the distressed state it is in, Vaidyanathan added.
Kamark, chief commercial officer (CCO) of Etihad Aviation Group, joined Jet’s board in November 2018.
Kamark served as executive vice president and CCO of Storebrand ASA, a Nordic financial services group. He spent 17 years at Scandinavian Airlines System, holding positions such as global head of sales and marketing CCO.