SpiceJet settles ₹755 crore-deal with EDC, to own 13 Bombardier Q400 planes; shares climb 7%
Spicejet Share Price Today: Shares of SpiceJet climbed over seven per cent earlier today after the low-cost budget carrier settled its ₹755-crore deal with Export Development Canada (EDC) to clear major liabilities. The deal will lead to a comprehensive revitalization of its balance sheet, said SpiceJet in its statement. This settlement is being termed as the biggest breakthrough in the airline's financial restructuring efforts till date.
On Tuesday, shares of SpiecJet opened at ₹58.58 and gained 7.54 per cent to hit an intra day high of ₹63.00 against a 52-week high of ₹77.50 apiece on the BSE. Shares settled 3.93 per cent higher at ₹61.06 apiece on the BSE. With the settlement of the agreement, SpiceJet will now own 13 Bombardier EDC-financed Q400 aircrafts.
As part of the settlement, SpiceJet will pay a comprehensive settlement amount to resolve outstanding liabilities amounting to close to $91 million as per SpiceJet books of accounts. ‘’This settlement not only alleviates SpiceJet of a substantial financial burden but also lays the groundwork for a fortified balance sheet and substantial savings for the airline,'' said SpiceJet in its statement. "We are pleased to have reached this settlement agreement with EDC and we thank their leadership and management team for their cooperation, understanding and progressive approach through the process.
This significant milestone will allow us to strengthen our balance sheet and position the airline for long-term success,'' said Ajay Singh, Chairman and Managing Director of SpiceJet. The liabilities stem from a loan acquired by the airline in 2011 for the procurement of 15 aircraft. With twelve of these Q400s currently grounded, their refurbishment and subsequent return to
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