Jet Airways founder Naresh Goyal may step down as chairman today

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In the meantime they will nominate two directors to Jet's board.

With Goyal's exit, lenders of Jet Airways are likely to pick up a substantial stake in the debt-laden airline till a new promoter is roped in.

Bidding process to be initiated by lenders for sale to new investor (s), the process expected to be completed in June quarter as per the resolution plan.

Last week, Reuters reported, citing two people in the know, that the central government had asked state-run banks to rescue the airline without pushing it into bankruptcy as Prime Minister Narendra Modi sought to avert thousands of job losses weeks before a general election. Most companies in Jet's financial condition would have been placed by creditors into India's new bankruptcy process.

The reports of Goyal's departure led to a rally in Jet's shares of more than 15 percent. Its lenders will convert their outstanding debt into equity shares for a token amount of one rupee and take a controlling stake in Jet.

It also needs to pay months' worth of salaries to pilots and other senior employees.

The decision paves the way for lenders, led by the State Bank of India (SBI), to invoke some of Goyal's shareholding and rescue the airline on an immediate basis.

Jet has survived collapse once before when it got close to running out of cash in 2013.

According to reports, Etihad's stakes in the company will be halved from 24 per cent to 12 per cent while Goyal's stake will be reduced to 25.5 per cent from the existing 51 per cent.

At present, Jet Airways is operating with just 41 planes out of its fleet of 119 planes after failing to repay rentals.

"Today is indeed a sad day for Indian aviation", said Ajay Singh, chairman and managing director at rival SpiceJet, adding that Goyal made India proud by launching a "world class" airline. "We urgently need to address structural challenges that make India's airlines uncompetitive to airlines around the world", Singh said.

Jet said its board has also approved the constitution of an interim management committee at the request of the lenders to manage and monitor the daily operations and cash flow of the company.

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