SpiceJet Ltd. reduced liability and plans to raise capital after Covid-19 damage, and accepted compensation from Boeing Co. for the grounding of 737 Max jets, Chairman Ajay Singh has said.
The budget carrier, which has suffered from the Covid air travel halt in India, aims to reduce liabilities by up to $300 million over six months and raise funds from banks and potentially issuing warrants, has Singh said in an interview in New Delhi.
“It will be a much cleaner record than it was pre-Covid,” Singh said ahead of a 737 Max flight to Gwalior with India’s aviation minister and members of the media to celebrate the airline’s return to service. ‘airplane.
Boeing Max planes were grounded around the world in March 2019 following crashes in Indonesia and Ethiopia that killed 346 people. Aside from China, major markets including the United States, Europe and India have allowed planes to resume flying after major fixes.
Boeing has compensated SpiceJet “both in cash and in kind” for the losses it suffered when the Max was grounded, Singh said, declining to specify an amount. SpiceJet had ordered 155 of the jets, with an option for 50 more. when the plane was banned.
SpiceJet jumped 7.5% to ₹84.40 on Tuesday in Mumbai.
The carrier, the first in India to operate a dedicated cargo fleet, is doubling down on its air cargo business, with the intention of separating it by January 1, Singh said. SpiceJet is also in talks with Boeing to buy freighter versions of 10 narrowbody and 5 to 10 widebody jets, he said.
“The cargo business is growing very rapidly and we are looking at all opportunities to raise funds to rapidly expand this business, and that includes selling a stake,” Singh said. “We expect the valuation to be quite significant.”
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