The Delhi High Court on Friday asked SpiceJet to pass a board resolution to issue stock warrants to Sun Group managing director Kalanithi Maran and his Kal Airways Pvt Ltd...
The Delhi High Court on Friday asked SpiceJet to pass a board resolution to issue stock warrants to Sun Group managing director Kalanithi Maran and his Kal Airways Pvt Ltd, as per a sale purchase agreement of 2015, which
led to a change in ownership of the carrier.
Justice Manmohan Singh asked both sides to come with the draft terms they are agreeable to, and then he would pass orders on the petition moved by Maran seeking a stay on transfer of any shares of the airline.
SpiceJet has assured the court that it will maintain status quo and not transfer shares to any third party till it passes an order. The matter has been listed for orders on March 14.
In a BSE filing last year, SpiceJet had said that according to the share sale and purchase agreement on January 29, between the company and Ajay Singh; the entire shareholding of the existing promoters (Kalanithi Maran and KAL) totaling 350.4 million equity shares (58.46% of the equity), has been transferred to Ajay Singh on 23 February.
Kalanithi Maran and KAL contend as per the deal agreement, they are entitled to receive redeemable warrants in return for approximately Rs 579 crore they spent on SpiceJet towards various debt payments and operating costs.
Market sources said that the petitioners were supposed to subscribe for fresh equity shares in two tranches. These warrants had to be converted to equity shares in April 2015 and April 2016. Sources further said that these warrants if issued and subscribed could potentially result in a 30% dilution of SpiceJet.
Maran and his airline, KAl, have alleged in their plea that despite giving around Rs 579 crore to Spicejet, the carrier failed to issue them the warrants or allot them tranche 1 and 2 of convertible redeemable preference shares and the amount was not utilised for paying statutory dues.
Spicejet, refuting these allegations, claimed that the warrants can be issued only after approval is received from Bombay Stock Exchange (BSE).