Comments
Low-cost carrier SpiceJet announced on Monday that it has successfully settled its ₹100-crore payment to City Union Bank. The company confirmed that the last installment of ₹25 crore was paid on 30 June, effectively closing the entire loan account that was taken in 2012.
The settlement with the bank follows a previous agreement reached with Nordic Aviation Capital (NAC), a major lessor for SpiceJet’s Q400 aircraft. The settlement between SpiceJet and NAC resolves all past liabilities related to the Q400s leased by NAC to the airline. The settlement with NAC and City Union Bank mark important steps towards resolving SpiceJet’s financial obligations and strengthening its position in the aviation industry.
As a result of this development, SpiceJet’s share price saw a significant surge in the final hour of trading. The stock rose by ₹3.39, or 12.44 per cent from the previous close, to reach ₹30.64. Throughout the day, the stock reached a high of ₹31.80 and a low of ₹27.50.
Committed to settlements
SpiceJet expressed its commitment to reachfavourable settlements with all its creditors as the airline focuses on rebuilding its fleet and business operations. In the previous month, aircraft lessor Wilmington Trust SP Services (Dublin) had sought insolvency proceedings against SpiceJet at the National Company Law Tribunal (NCLT). Similarly, other lessors, such as Aircastle and Willis Lease Finance, had also approached the tribunal to recover their dues from the airline.
In May 2023, the Directorate General of Civil Aviation (DGCA) deregistered three planes belonging to SpiceJet based on requests from lessors. However, SpiceJet stated that one lessor had requested the DGCA to suspend the deregistration of two aircraft, while the remaining three were already grounded and not operational. The airline emphasised that these actions had no impact on its current operations and reiterated its focus on getting its grounded fleet back into service.
SpiceJet operates approximately 250 daily flights to 48 domestic and international destinations.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.