SpiceJet (SG, Delhi International) has allotted lessors preferential shares worth INR2.31 billion Indian rupees (USD27.9 million) to settle outstanding debts. Shareholders approved the decision to do so at an August 31 meeting. The same meeting also provided details of a promised investment by SpiceJet's chief executive officer, Ajay Singh.

In a September 4 filing with the Mumbai Stock Exchange (BSE), SpiceJet said last week's shareholders meeting had approved an allotment of 4,81,23,186 equity shares with a face value of INR0.10 (USD0.0012) each at an issue price of INR48 (USD0.58) each on preferential basis to nine aircraft lessors, converting existing outstanding debts totalling INR2,309,912,928. The INR48 issue price is around a 50% premium on SpiceJet's current share price. Those nine lessors and their individual; share allotments are;

  • SASOF III (A13) Aviation Ireland DAC (67,00,436 equity shares);
  • SASOF III (A6) Aviation Ireland DAC (87,22,473 equity shares);
  • SASOF III (C) Aviation Ireland DAC (22,22,456 equity shares);
  • SASOF III (E) Aviation Ireland DAC (20,81,080 equity shares);
  • SASOF III (A19) Aviation Ireland DAC (63,34,683 equity shares);
  • SASOF II (J) Aviation Ireland DAC (80,56,650 equity shares);
  • Citrine Aircraft Leasing Limited (45,51,214 equity shares);
  • Fly Aircraft Holdings Seven Limited (53,34,264 equity shares); and
  • Fly Aircraft Holdings One Limited (41,19,930 equity shares).

ch-aviation fleets data reveals that the SASOF special purpose vehicles (SPVs) used to lease aircraft to SpiceJet are under the control of Carlyle Aviation Partners. Fly Aircraft Holdings is controlled by an entity called Fly Leasing Limited, which is also a Carlyle-owned company. Citrine Aircraft Leasing Limited can also be traced to the same Dublin address as Fly Aircraft Holdings. Earlier this year, the low-cost carrier said it would convert approximately USD100 million owed to Carlyle into equity and debentures.

The shareholders meeting also approved the issue of over 34 million equity shares and over 131 million warrants to Spice Healthcare Private Limited, owned by SpiceJet's majority owner, Ajay Singh. In July, in a bid to revive the ailing airline, Singh said he would invest approximately INR5 billion USD60.4 million) into SpiceJet. Specifically, the BSE filing reveals the following about Singh's investment;

  • An allotment of 34,172,000 equity shares with a face value of INR0.10 (USD0.0012) each at an issue price of INR29.84 (USD0.36) each on a preferential basis to Spice Healthcare Private Limited; and

  • An allotment of 131,500,000 warrants, with options to apply for and be allotted an equivalent number of equity shares of the face value of INR0.10 (USD0.0012) each at an issue price of INR29.84 (USD0.36) each on preferential basis to Spice Healthcare Private Limited.

SpiceJet has faced significant operational and financial headwinds this year that has seen its domestic market share decline to 4.2%. The uncertainty surrounding the airline, exacerbated by the Go First (Mumbai International) insolvency, has seen multiple lessors attempt to repossess planes and head to court to claw back overdue lease payments. Lessors with legal and insolvency proceedings underway against SpiceJet include Wilmington Trust SP Services (Dublin), Willis Lease Finance, Aircastle, and Celestial Aviation Services Limited. In addition, SpiceJet has just days to make good on a INR1 billion (USD12.1 million) payment due to former majority owner Kalanithi Maran, who is owed a total of INR3.79 billion Indian rupees (USD48.1 million) and wants the courts to allow him to seize 50% of SpiecJet's weekly revenues to start paying that debt down.