SpiceJet Raises Additional Funds Worth Rs 316 Crore; Total Funds Reach Rs 1,060 Crore

 "SpiceJet has raised an additional Rs 316 crore, bringing the total investments raised to Rs 1,060 crore under its preferential issue," the airline said in a statement

Cash-strapped airline SpiceJet said on Thursday it has managed to secure additional funds worth Rs 316 crore. This raises the airlines' total funds to Rs 1,060 crore via a preferential share issue. This inflow of fresh capital into the struggling airline coincides with its recent announcement of reducing its workforce by 10 to 15 per cent.

In January, SpiceJet received Rs 744 crore as the initial instalment of funds through the allotment of securities on a preferential basis. Additionally, on December 12, the airline announced its intention to raise fresh capital of Rs 2,250 crore through the issuance of securities.

 "SpiceJet has raised an additional Rs 316 crore, bringing the total investments raised to Rs 1,060 crore under its preferential issue," the airline said in a statement.

"The Preferential Allotment Committee of SpiceJet's Board Directors convened on February 21, 2024, approved the allotment of 4.01 crore equity shares on a preferential basis to two investors, including Aries Opportunities Fund Limited,” it added.

As per the statement, the committee also approved the allocation of 2.31 crore warrants, providing the opportunity to subscribe to an equivalent number of equity shares to four investors, which include Elara India Opportunities Fund Limited. "The company has raised a total investment of Rs 1,060 crore. This significant capital infusion reaffirms investor confidence in SpiceJet's growth prospects and strengthens our financial position for the future," said Ajay Singh, Chairman and Managing Director at SpiceJet.

He further mentioned that the supplementary funding will support SpiceJet in advancing its expansion strategies and improving its operational capabilities.

Meanwhile, for the past few quarters, SpiceJet has encountered challenges due to a lack of funds, resulting in the grounding of several aircraft and the return of leased planes to lessors. Some lessors have even taken legal action against the airline for non-payment of lease rentals. According to the aircraft fleet tracking website Planespotter, as of February 21, approximately half of SpiceJet's fleet of 65 aircraft were grounded, with 35 planes in service and the rest parked.