1. Kalanithi Maran’s assurance, hectic parley buy SpiceJet a week

Kalanithi Maran’s assurance, hectic parley buy SpiceJet a week

After a full day of hectic negotiations and an assurance by Spicejet promoter Kalanithi Maran of coming with a revival plan, the government...

By: | New Delhi | Updated: December 16, 2014 8:05 AM
Spicejet officials, who had met DGCA Prabhat Kumar earlier in the day, has reportedly sought removal of the ban on offering ticket bookings beyond 30 days. Reuters

Spicejet officials, who had met DGCA Prabhat Kumar earlier in the day, has reportedly sought removal of the ban on offering ticket bookings beyond 30 days. Reuters

After a full day of hectic negotiations and an assurance by Spicejet promoter Kalanithi Maran of coming with a revival plan, the government on Monday evening gave the beleaguered low-cost carrier another week’s time to finalise a payment plan. A top government official said the olive branch was offered to prevent massive job losses and inconvenience to passengers, who had already booked tickets for the peak travel season.

The airline, whose previous deadline to clear almost Rs 200- crore of dues to Airports Authority of India (AAI) had ended on Monday, will now not be put on the cash and carry mode for the time being. However, oil companies HPCL and IOC have already put the airline on the cash and carry mode, where they have to make payments every time an aircraft takes off. Spicejet has to clear Rs 2,000- crore dues in all, of which Rs 1,400 crore need to be cleared immediately to keep the airline afloat.

“They have asked for relief and we are putting it before senior people in the government in the PMO, finance ministry and petroleum ministry. We have not given any assurances, but will have to take a decision based on the wider interest of passengers,” Mahesh Sharma, MoS for civil aviation, said after meeting top Spicejet officials, including COO Sanjiv Kapoor and promoter Sun Group CFO SL Narayan.

Spicejet officials, who had met DGCA Prabhat Kumar earlier in the day, has reportedly sought removal of the ban on offering ticket bookings beyond 30 days. Because of the ban, the airline’s cash flow has been severely hampered. In fact, catering services to Spicejet flights have also been stopped from Monday morning. “There is nothing new in terms of a revival plan in what the Spicejet officials said today,” a DGCA official said.

DGCA had previously given the airline time till Monday to release pending salaries of employees. However, pilots and senior management in the top 15% pay bracket are yet to be paid for last month. The regulator has also asked the airline to submit a revival plan and a schedule of how it expects to clear dues.

Till date, SpiceJet has gradually reduced flights across its network from 332 daily to 239 till date, according to latest official figures. It has cancelled over 1,800 flights a month. It has shrunk its fleet from 58 aircraft to nearly 37.

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  1. Jaswant Singh
    Dec 17, 2014 at 12:10 pm
    Kalanidhi Maran and his wife Kavery Maran taking highest annual pay packages of Rs. 56.25 crores each from Sun Group of Companies including e Jet. Ultimately not only e jet but Sun Group of companies have to go in red. They are eating into investors money. When they get such fat packages, why thy were not making payments to oil companies and Airports Authority of Indis while they were reading these dues from pengers. They need to be checked in from pering the investors money.
    Reply
    1. V
      Venky
      Dec 16, 2014 at 11:31 am
      Wonder how the maran's got the money to buy the airliner in the first place. Hope the govt. investigates that.
      Reply
      1. V
        Venky
        Dec 16, 2014 at 11:31 am
        Wonder how the maran's got the money to buy the airliner in the first place. Hope the govt. investigates that.
        Reply

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