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SpiceJet's acquisition of Boeing aircraft to be over in 2 years

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Mr Peter A. Hill, Chief Operating Officer, Spicejet Ltd, and Mr Siddhanta Sharma, CEO, at a press conference in Chennai on Saturday. Bijoy Ghosh
Mr Peter A. Hill, Chief Operating Officer, Spicejet Ltd, and Mr Siddhanta Sharma, CEO, at a press conference in Chennai on Saturday. Bijoy Ghosh

Our Bureau

Chennai, Nov. 12

SPICEJET'S acquisition of the ten Boeing 737 800 aircraft will be completed by 2007 end, according to its CEO, Mr Siddhanta Sharma.

It would also lease four more aircraft between February and May next year, he said.

The airline had gone in for a foreign currency convertible bond issue to raise $70-80 million to fund its expansion plans.

Mr Sharma said a preferential allotment of $12 million at Rs 90 per share has been made to Isthitmar, UAE-based financial institution. Six to seven other investors are there but they are still exploring their options. The shares would be listed on the Luxembourg Stock Exchange, he said.

In a related development on Friday, Temasek Holdings Pte Ltd, a Singapore Government's investment company, said it would not invest in SpiceJet. Mr Sharma told Business Line that they could not come to an agreement on the conversion rate.

The airline's strategy is to deploy aircraft on long haul routes offering more flights preferably daily doubles between metros. The frequency and punctuality would attract companies, he said.

SpiceJet will add Chennai and Hyderabad to its network from November 14. It has also come out with an introductory offer of Rs 999 in these cities, and the offer is available for travel till the end of November.

The promotional fare on the Chennai-Mumbai sector ranges from Rs 999 to Rs 1,599 and the regular fare is Rs 1,799. The promotional fare on the Delhi-Chennai ranges from Rs 1,999 to Rs 2,199 and the regular fare is Rs 2,499. These fares were likely to stimulate and grow the market, he said.

The airline plans to introduce a night flight from Chennai to Delhi via Hyderabad in December.

SpiceJet plans to station an aircraft in Chennai. The airline has based three aircraft in Delhi, and one each in Mumbai and Kolkata. It operates 28 flights a day to Delhi, Mumbai, Ahmedabad, Goa, Pune, Bangalore, Kolkata, Jammu and Srinagar carrying an average of 4,500 passengers.

(This article was published in the Business Line print edition dated November 13, 2005)
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