SpiceJet on Wednesday said it has completed the allotment of equity shares to global aircraft leasing and financing firm Carlyle Aviation Partners, a move that has helped the airline reduce its liabilities by Rs 442.25 crore ($50 million) and strengthen its long-term financial position.
The airline’s Allotment Committee approved the issuance of 10.41 crore equity shares of face value Rs 10 each at an issue price of Rs 42.32 per share, including a premium of Rs 32.32, on a preferential basis under the non-promoter category.
What did Ajay Singh say?
Chairman and Managing Director Ajay Singh, said: “This is an important milestone in our ongoing restructuring efforts and reflects our commitment to building a stronger and financially resilient SpiceJet. The removal of liabilities, combined with access to substantial maintenance reserves and credits, provides us with meaningful support as we continue to revive our fleet and expand operations.”
The company had earlier announced on September 11 that it had reached a settlement with Carlyle Aviation Partners to restructure certain lease dues amounting to $121.18 million. The agreement was expected to unlock $89.5 million in liquidity and support the airline’s broader restructuring efforts.
What does the settlement dictate?
Under the settlement, if lessors realise proceeds above $50 million from the sale of the issued shares, a portion of the surplus will be used to offset future lease obligations. SpiceJet said the deal also entitles it to $79.6 million in cash maintenance reserves for future aircraft and engine maintenance, and $9.9 million in maintenance credits to offset lease dues.
Singh added that several other restructuring initiatives are underway and expressed hope of concluding them soon as the airline works toward building “a stronger, more resilient airline for our customers, partners, and shareholders.”
Last week, the airline reported a higher net loss of Rs 635.42 crore for the September quarter, hit by foreign exchange losses, additional costs related to grounded and re-inducted aircraft, and airspace restrictions.
