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SpiceJet in distress as creditors circle like beasts of prey
来源：shippingazette 编辑：编辑部 发布：2023/09/05 16:06:30
SPICEJET has admitted to an Indian court that it is "struggling to stay afloat." The low-cost carrier's counsel, Amit Sibal, made the admission at a Delhi High Court hearing in the matter of Kal Airways Pvt Ltd vs Spicejet Ltd & Anr.
The airline and its promoter, Ajay Singh, requiring it to pay INR3.79 billion (US$48.1 million) to former majority owner Kalanithi Maran and his associated entity, Kal Airways, reported Switzerland's Ch-Aviation.
The debt, relating to promised share transfers connected to the 2015 ownership change, has been in and out of the Indian courts since 2018 but now appears to be approaching the end.
On July 31, the High Court refused to interfere with previous payment directions and gave SpiceJet and Singh until September 10 to pay at least INR1 billion or risk asset seizure and Mr Singh risk arrest.
On August 24, Justices Yashwant Verma and Justice Dharmesh Sharma promptly dealt with an appeal from SpiceJet and Mr Singh. Sibal argued that the July 31 order was invalid because it was heard by a single judge, rather than a panel of judges.
Mr Sibal asked that the July order be overturned. However, Verma and Sharma declined to do this, saying there were no issues with the matter going before a single judge.
In response, Mr Sibal submitted an offer to pay INR750 million by the September deadline, a request the judges also rejected, saying SpiceJet must pay the full INR1 billion.
Mr Sibal said the airline's financial challenges were behind the reduced offer. However, after the ruling, the airline later said it would "make the specified payment within the prescribed timeframe."
Appearing for Maran, Maininder Mr Singh told the court that SpiceJet had voided its right to make any further applications, given its disregard towards previous orders. Last week, SpiceJet also announced a second-quarter profit of INR1.98 billion.
However, the profit only goes some way to relieving the carrier's financial problems. In court, an unrelenting Mr Singh asked that the entire amount be handed to his client, plus any future profits, if the July order was not abided by. However, there is no indication that the court immediately agreed to this proposal.
The airline and its promoter, Ajay Singh, requiring it to pay INR3.79 billion (US$48.1 million) to former majority owner Kalanithi Maran and his associated entity, Kal Airways, reported Switzerland's Ch-Aviation.
The debt, relating to promised share transfers connected to the 2015 ownership change, has been in and out of the Indian courts since 2018 but now appears to be approaching the end.
On July 31, the High Court refused to interfere with previous payment directions and gave SpiceJet and Singh until September 10 to pay at least INR1 billion or risk asset seizure and Mr Singh risk arrest.
On August 24, Justices Yashwant Verma and Justice Dharmesh Sharma promptly dealt with an appeal from SpiceJet and Mr Singh. Sibal argued that the July 31 order was invalid because it was heard by a single judge, rather than a panel of judges.
Mr Sibal asked that the July order be overturned. However, Verma and Sharma declined to do this, saying there were no issues with the matter going before a single judge.
In response, Mr Sibal submitted an offer to pay INR750 million by the September deadline, a request the judges also rejected, saying SpiceJet must pay the full INR1 billion.
Mr Sibal said the airline's financial challenges were behind the reduced offer. However, after the ruling, the airline later said it would "make the specified payment within the prescribed timeframe."
Appearing for Maran, Maininder Mr Singh told the court that SpiceJet had voided its right to make any further applications, given its disregard towards previous orders. Last week, SpiceJet also announced a second-quarter profit of INR1.98 billion.
However, the profit only goes some way to relieving the carrier's financial problems. In court, an unrelenting Mr Singh asked that the entire amount be handed to his client, plus any future profits, if the July order was not abided by. However, there is no indication that the court immediately agreed to this proposal.