The airline also said that it has sought additional time from regulators to complete the remaining tranche of funding which has been necessitated due to limited banking days arising from long weekends during the intervening period.
This is part of the funding plan which the cash-strapped carrier had announced in December announced that its board had approved raising fresh capital of Rs 2,250 crore from 63 entities, including financial institutions, foreign institutional investors, high-net-worth individuals, and private investors such as Elara India Opportunities Fund, Aries Opportunities Fund, Mahapatra Universal Limited, Nexus Global Fund, Prabhudas Lilladher, and Resonance Opportunities Fund.
The funding will be raised in two tranches of Rs 1,591.5 crore by June 2024 and Rs 650 crore by July 2025. After the funding promoter Ajay Singh’s current shareholding in the airline will reduce from 56.49% to at least 38.55 % once the shareholders approve the issuance of equity and warrants. 37.9 % of Singh’s stake is pledged with various banks.
Singh said that the investment will help the airline to induct fresh capacity and reduce liabilities, thereby reducing cost of capital. “It helps us to induct fresh capacity, settle some liabilities which we accrued during Covid. This will also give confidence to lessors, vendors,” he said, adding that the capital raised will put the airline in a comfortable position.
SpiceJet will soon start discussion with Boeing for resuming induction of new 737 Max aircraft of which it has more than 200 on order.SpiceJet has been taking capital from its partners which has a high cost of capital. It also has unpaid statutory dues like TDS and other taxes due to which it accrues interest. “This fundraising will help us to settle that which will significantly reduce the interest burden,” Singh said.