NEW DELHI: Cash-starved-airline SpiceJet will consider raising funds in its upcoming board meeting, which is scheduled to take place on Monday. The decision to raise fresh funds was taken as the airline and its promoter have to make payments to aircraft lessors and a few other parties as well.
“This is to inform you that the Board of Directors of the Company in its meeting scheduled on December 11, 2023 (Monday) will discuss and consider, inter-alia, options for raising fresh capital through issue of equity shares and/or convertible securities on preferential basis, in accordance with the relevant provisions of applicable laws and subject to approval of the shareholders of the Company and receipt of applicable regulatory approvals, as may be required,” said SpiceJet in a regulatory filing on Thursday. The airline will also approve its second-quarter (Q2) results on Monday.Following this, SpiceJet shares surged 20% to hit a 52-week high of Rs 52.29 on the exchanges.
Struggling to stay afloat, SpiceJet is facing a severe cash crunch for the past several quarters. The airline is also involved in multiple legal disputes regarding money owed to former promoter K Maran, financial services firm Credit Suisse, and multiple lessors. According to reports, the low-cost carrier faced a major humiliation on November 30th after one of its aircraft which was flying to Dubai was seized by a lessor after landing.
On Thursday, Spicejet received relief after the National Company Law Tribunal granted the airline and aircraft lessor Celestial Aviation Services more time to settle their dispute. Celestial Aviation had taken SpiceJet to the insolvency court in August over non-payment of dues. The airline is also facing insolvency proceedings initiated by other lessors—Aircastle (Ireland) Ltd. and Wilmington Trust SP Services (Dublin) Ltd.