Carlyle to pick up 7.5 per cent equity stake in SpiceJet
As part of its debt recast plan, the airline will demerge its cargo business and transfer it to subsidiary SpiceXpress & Logistics (SXPL) in lieu of CCDs to be issued by latter.
Published: 28th February 2023 09:04 AM | Last Updated: 28th February 2023 09:04 AM | A+A A-
Image for representational purpose.
NEW DELHI: In order to overcome the financial crisis, budget airline Spicejet is taking steps to fix the issues amid rising competition. The airline said on Monday its board has restructured over USD 100 million dues to aircraft lessor Carlyle Aviation Partners into equity and compulsorily convertible debentures (CCDs).
The SpiceJet board has proposed raising fresh capital of up to Rs 2,500 crore via eligible securities to qualified institutional buyers. Carlyle will receive a 7.5 per cent stake in Spicejet and CCDs in the airline’s cargo subsidiary unit as part of its debt-restructuring plan.
SpiceJet will issue fresh equity shares of Rs 244.28 crore to Carlyle at Rs 48 per share or the SEBI-determined price, whichever is higher. Following this transaction, Carlyle will have over 7.5 per cent stake in SpiceJet. As part of its debt recast plan, the airline will demerge its cargo business and transfer it to subsidiary SpiceXpress & Logistics (SXPL) in lieu of CCDs to be issued by the latter.
Additionally, SpiceJet will transfer CCDs of SpiceXpress, the airline’s cargo subsidiary, aggregating to $65.5 million in exchange for its lease liabilities. The CCDs will be converted into equity shares of SpiceXpress at an anticipated future valuation of Rs 12,422 crore.
Ajay Singh, Chairman and MD of SpiceJet, said, “Carlyle picking up a stake in our passenger and cargo business reinforces huge potential of SpiceJet and SpiceXpress…The transaction will deleverage our balance sheet allowing us to access fresh funds at a competitive rate and we aim to follow suit with other lessors as well in the near term.”
SpiceJet flight makes emergency landing at Kolkata airport
A SpiceJet flight on its way to Bangkok made an emergency landing at Kolkata airport in the early hours of Monday after the pilot noticed an engine blade was broken, officials said. The Boeing 737, operating as flight SG83, took off with 178 passengers and six crew members from the Kolkata airport for Bangkok around 1.09 am. Minutes later, the pilot noticed that a blade of the left engine was broken, they said. Soon, he contacted the air traffic control and a full emergency was declared at the Kolkata airport with fire engines, ambulances, and emergency teams of the CISF in waiting, they added.
Plans ahead
- SpiceJet has approved plans to raise fresh capital up to `2,500 crore via QIP
- Airline’s board also approved conversion of its existing dues to Carlyle Aviation into equity worth USD 29.5 million
- SpiceJet to transfer its cargo business to its subsidiary SpiceXpress & Logistics for `2,556 crore in the form of equity shares and debentures
