The Delhi High Court has ordered SpiceJet (SG, Delhi International) to pay two engine lessors INR37 million (USD445,000) by January 3, 2024. Justice Rekha Palli ruled in favour of the two lessors, Team France 01 SS and Sunbird France 02 SS, in a December 19, 2023, hearing.
The two special purpose vehicles (SPVs) are owed USD12.9 million, with SpiceJet being in arrears for two years. The SPVs have terminated the engine leases over the breaches. In addition to monies owed, counsel for the lessors asked for a restraining order preventing the airline from using the remaining engine/s.
Palli ordered the money be paid to the lessors in a series of installments running from December 21 through January 3. The matter is relisted for hearing on January 4. As reported by Money Control, Palli indicated she was likely to grant the restraining order at the next hearing, given SpiceJet did not dispute they owed the money. "Someone's engines you are enjoying for years, and you are not paying them," the judge said. "If you are unable to pay, return their engines."
A SpiceJet spokesman recently told ch-aviation that the LCC was regularly clearing its dues and currently undertaking a capital raise, part of which is earmarked to settle litigation. Assorted engine and airframe lessors are seeking legal redress against SpiceJet over lease breaches, with some seeking to have the airline declared insolvent in the National Company Law Tribunal and others seeking alternative remedies in forums such as the Delhi High Court.
Indian media outlets report that some of the planned capital raise may come from Mumbai-based businessman Harihara Mahapatra and his wife, Preeti. The Times of India reports that the Mahapatras, once an aspiring politician, are behind an entity called Mahapatra Universal Limited, which has interests across the real estate, infrastructure, consulting, consumer and retail sectors. According to a funding proposal seen by the newspaper, the Mahapatras plan to invest INR11 billion rupees (USD132.4 million) in return for a 19% stake in SpiceJet. The airline hopes to raise around double that amount after issuing 130 million convertible bonds and 321 million shares and reportedly has a series of investors lined up, including the Mahapatras.
Separately, SpiceJet has told the Bombay Stock Exchange (BSE) via a December 19 filing that it was keen to buy its insolvent competitor, Go First (Mumbai International), saying combining the two entities would create a strong and viable airline.
"The board (of SpiceJet) has recently approved and initiated the process of raising fresh capital of about USD270 million to strengthen its financial position and invest in growth plans," the filing read.
