SpiceJet (SG, Delhi International) has raised INR25.56 billion rupees (USD309 million) by hiving off its cargo business, SpiceXpress (Delhi International), into a separate unit, it announced in a filing to the Bombay Stock Exchange on February 27.

At a meeting that morning, SpiceJet’s board of directors “agreed to enter into a Business Transfer Agreement” with the subsidiary, SpiceXpress and Logistics Private Limited (SXPL), on a slump sale basis (i.e., for a lump sum, without values assigned to assets and liabilities), the disclosure said.

SXPL will exclusively operate the cargo business from April 1, 2023, it added.

SpiceJet also said in the statement that it had agreed to convert its debts to Carlyle Aviation Partners into new shares worth USD29.5 million, giving the Miami-based lessor a 7.5% stake in SpiceXpress. The move followed speculation last week about an upcoming a debt-to-equity swap involving Carlyle.

SpiceJet will also transfer USD65.5 million worth of compulsorily converted debentures in SpiceXpress and Logistics to Carlyle, for the lessor to convert into shares in the cargo business at a later date. Overall, the deal will wipe out around USD100 million in SpiceJet debt.

“This restructuring will substantially reduce the existing liabilities of the company and will help in fundraising for the business operations of the company,” the filing said.

SpiceJet, which shouldered a net debt of INR10.19 billion (USD123.33 million) as of March 2022, also said it would seek shareholder approval “for raising fresh capital” of up to INR25 billion (USD302.6 million) by issuing securities to qualified institutional buyers.

According to the ch-aviation fleets module, SpiceJet currently leases seven B737-800s and three B737-900ERs from Carlyle Aviation Partners. Of its total fleet of 70 aircraft, 57 are leased from 16 lessors including Carlyle.

Contacted by ch-aviation, Carlyle Aviation Partners declined to comment.