Beleaguered budget carrier SpiceJet on Friday submitted a revival plan to the Government on the basis of a proposed investment of $200 million from founding promoter Ajay Singh and US-based JP Morgan Chase.
"It was a constructive meeting," the airline's Chief Operating Officer Sanjiv Kapoor told reporters after he submitted the plan to Civil Aviation Secretary V Somasundaran at the Ministry headquarters. He was accompanied by Singh, the original promoter who is reinvesting in the carrier. Maintaining that there was "no outstanding" as of now with any oil marketing company, he said with 18 operational Boeing aircraft, Spicejet was currently flying 230 flights a day. "Spicejet has many well wishers including Ajay Singh," the COO said.
Besides Singh, a fund managed by JP Morgan Chase would also be one of the investors. The potential investors are likely to buy stake from current promoter Kalanithi Maran by infusing $200 million within a month to help the airline stay afloat. The airline has already received Rs17 crore from the investors, official sources earlier said, adding that "it has wiped off all its dues to the oil companies". The no-frill carrier's dues to foreign and Indian vendors, airport operators and oil companies had grown from Rs990 crore to Rs1,230 crore between November 24 and December 10, according to data provided by the airline to the Civil Aviation Ministry.
The airline's dues to foreign vendors, including lessors of aircraft and maintenance, repairs and overhaul (MRO) facilities, had risen from Rs624 crore on November 24 to Rs742 crore on December 10, according to the data. Spicejet owes banks Rs300 crore against collateral. Meanwhile shares of SpiceJet surged 9 per cent during the day following reports that the budget carrier would submit a revival plan to the Government.
SpiceJet's scrip jumped 9.07 per cent to settle at Rs19.25 on the BSE. During the day, it gained 11 per cent to Rs19.60. In terms of volume, 311.76 lakh shares of the company changed hands on the BSE during the day. Civil Aviation Minister Ashok Gajapathi Raju on Thursday had said that the current situation within SpiceJet was the outcome of its internal problem and it needed to set its house in order.
"The problem that SpiceJet is going through is economic. They have to solve it. They have to fundamentally get their things right," the minister had said. He had added that the Government is trying to help the aviation sector overcome its problems, but quipped that "the Government's role is that of a facilitator. To remove the impediments, if any. Whatever the Government will do for the airlines, it will be for all. It will not single out one airline".