SpiceJet share price jumps 12% as it repays ₹100-crore loan to City Union Bank
1 min read 03 Jul 2023, 02:42 PM ISTSpiceJet has settled its ₹100 crore payment to City Union Bank, with the last tranche of ₹25 crore paid on 30 June, 2023. The repayment follows a settlement agreement with Nordic Aviation Capital.
PremiumSpiceJet on 3 July has announced that it has settled its ₹100 crore payment to City Union Bank. As per the company's statement, the last tranche of ₹25 crore was paid on 30 June, 2023.
"The last tranche of ₹25 crore was paid on June 30, 2023, successfully closing the entire loan account which was taken in the year 2012," it said.
It added that repayment to City Union Bank follows a successful settlement agreement with Nordic Aviation Capital (NAC). On 21 June, the carrier entered into a settlement agreement with Nordic Aviation Capital, a major lessor for its Q400 aircraft. According to a Reuters report, the settlement agreement between the Indian low-cost carrier and Nordic Aviation Capital settles all past liabilities for the Q400s leased by NAC to SpiceJet.
SpiceJet share price skyrocketed in the last hour of the trade on this announcement rising ₹3.39, or 12.44%, over the previous close to ₹30.64. The stock touched a high of ₹31.80 and a low of ₹27.50 through the day.
“SpiceJet remains committed to finding amicable settlements with all its creditors as the airline builds back its fleet and its business," it said.
Last month, aircraft lessor Wilmington Trust SP Services (Dublin) had moved the National Company Law Tribunal (NCLT) to initiate insolvency against Indian low cost carrier SpiceJet. Prior to that aircraft lessor Aircastle and engine lessor Willis lease finance had moved the tribunal for recovering their dues.
In May 2023, three planes of SpiceJet were deregistered by the Directorate General of Civil Aviation (DGCA) at the request of lessors. "Out of the five planes listed for deregistration, one lessor requested DGCA to suspend the deregistration of two aircraft. Out of the remaining three, two were grounded for a long period and not operational. Hence, there is no impact on our operations. We remain focussed on bringing on our grounded fleet back into operations," a SpiceJet spokesperson had said in May.
SpiceJet operates about 250 daily flights to 48 destinations within India and to international destinations. Its fleet is a mix of aircraft including Boeing 737 Max, Boeing 700 and Q400s.
(With inputs from agencies)
