The managing director and promoter of SpiceJet (SG, Delhi International) will sell 10% of his stake in the carrier in a bid to raise around INR30 billion rupees (USD357 million) to help keep the airline afloat, according to The Economic Times. Singh, along with family members and entities associated with him, currently holds a 47.8 % stake in SpiceJet.

The report suggests the share parcel is already being touted to potential investors and may settle as soon as September. The sale will see Singh's stake in SpiceJet drop to between 30 - 35%, but he will remain its biggest shareholder. However, the MD's stake will increase by 9% again later this year when he can convert around INR3 billion (USD35.7 million) worth of warrants into shares.

In an August 8, 2024, email to a group of pilots explaining that payment of their June salaries would be delayed, flight operations vice president Virendra Malhotra said SpiceJet was seeking bridging finance to help cover its day-to-day operations. On August 14, SpiceJet announced an INR1.58 billion (USD18.8 million) consolidated net profit for the first quarter of 2024, down 26.7% on the comparable 2023 quarter. The profit drop was attributed to the airline operating fewer flights and generating less revenue. Its domestic market share is now around 4%.

Late last year, SpiceJet announced plans to raise INR22 billion (USD262 million), later approved by the board and Indian regulators. However, the airline has only managed to raise INR10.06 billion (USD119.8 million) so far after a key investor backed out. Last month, SpiceJet's board green-lighted plans to try again and attempt to raise INR30 billion (USD357.2 million) via institutional placements to qualified institutional buyers. It is unknown whether Singh's decision to sell his stake is a response to lacklustre institutional interest.

SpiceJet ordered to handover engines

Meanwhile, SpiceJet's bid to hold onto three engines leased to it by special purpose vehicles Team France 01 SAS and Sunbird France 02 SAS has failed, with the Delhi High Court's Justice Manmeet Pritam Singh Arora telling the carrier on August 15 to ceasing using them by August 17 and return them within 15 days. Both lessors have been pursuing SpiceJet for lease arrears and their engines, while SpiceJet has bought time and continued to use them by promising to pay by certain dates but mostly failing to honour those commitments.

Last week, the judge sought personal guarantees from SpiceJet's directors, resulting in Singh offering to pledge personal shares equivalent to USD2.5 million, roughly half of the USD4.8 million that SpiceJet owes the lessors. However, counsel for the lessors rejected the offer, saying neither wanted shares in a company "whose existence is shaky".

Reading her decision, Singh Arora called SpiceJet a “defaulter (with no) no legal and contractual right to continue using the engines”.

“The inability of the defendant to pay the admitted outstanding dues is writ large on the face of the record, and in fact, permitting the defendant to continue the use of the engines without payment would only cause financial distress to the plaintiff and, therefore, the balance of convenience is against the defendant," she said, adding that SpiceJet remained obliged to continue making payments per a May 29, 2024, agreement, including making payments for the period in which the airline continued to use the engines.