SpiceJet shares rose by 5.5% following the announcement of a restructuring deal with Carlyle Aviation. The agreement involves converting $40 million of SpiceJet’s dues into equity, effectively reducing the airline’s debt from $137.68 million to $97.51 million. As a result, Carlyle Aviation will become a key shareholder in SpiceJet, which has been grappling with financial challenges for several years.
The restructuring is part of SpiceJet’s broader strategy to manage its financial obligations and stabilize its operations. In addition to the Carlyle deal, the airline’s promoter and chairman, Ajay Singh, plans to sell a stake of up to 15% in the company. Singh currently holds a 37.57% stake in SpiceJet, and the potential sale could raise much-needed funds. This capital is expected to be used for restoring the airline’s grounded aircraft, expanding its fleet, and settling other liabilities.
SpiceJet’s financial difficulties have been a result of mounting debts and legal challenges, which led to the grounding of 36 aircraft over the past few years. The airline’s fleet size has shrunk significantly, from 74 aircraft in 2019 to just 28 in 2024. However, the company has outlined plans to unground 28 aircraft, aiming to double its operational capacity and secure its position in both regional and international markets.
The restructuring deal and potential stake sale mark a crucial step in SpiceJet’s efforts to rebuild its financial health and operational capacity. By converting debt into equity and raising new funds, the airline aims to overcome the challenges it faces and pave the way for future growth. SpiceJet remains optimistic about these developments, viewing them as an opportunity to strengthen its market position and improve its overall performance.
