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2 min read | Updated on September 09, 2024, 10:15 IST
SUMMARY
The airline on Friday said it will convert about $97 million of its dues to the commercial aviation investment and servicing arm of Carlyle Group into equity and debentures.
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The funding round is expected to be completed by the end of September.
Shares of SpiceJet, the cash-strapped low-cost airline, gained as much as 5.5% to ₹64.86 apiece on the BSE on Monday, September 9, as the airline on Friday said it will convert about $97 million of its dues to the commercial aviation investment and servicing arm of Carlyle Group into equity and debentures.
The restructuring plan comes as the budget airline has struggled to fully restore operations despite multiple fundraises over the last year.
In a separate development, reports said SpiceJet promoter and chairman Ajay Singh may offload more than 10% stake in the struggling carrier as part of the latest funding round that is expected to close by the end of September.
The budget carrier, which is grappling with multiple woes, including financial challenges, legal battles, and grounding of aircraft, is looking to raise money that will help it meet various obligations.
The funding round is expected to be completed by the end of September.
In a presentation on Friday, SpiceJet attributed factors such as reduction in fleet and subsequent grounding, higher cost of working capital, escalating fixed costs, fixed rentals at airports, and outstanding statutory dues as the factors for its current problem.
According to the presentation, its operational fleet has been reduced to 28 planes in 2024 against 74 aircraft in 2019, while 36 aircraft remained on the ground due to the funding issue.
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