SpiceJet settles Rs 93-cr dispute with aircraft lessor Cross Ocean Partners, to acquire additional assets

Low-cost airline SpiceJet informed the Delhi High Court on Tuesday that it has reached a settlement terms with aircraft leasing firm Cross Ocean Partners resolving its dispute of about Rs 93 crore ($11.2 million). As part of the arrangement, the airline will also benefit from the transfer of airframe and an engine at no additional cost, augmenting its operational capabilities, the company told the High Court today.

“We are pleased to have reached a mutually acceptable resolution with Cross Ocean Partners, which will result in significant cost savings for SpiceJet and also cease prolonged expensive litigation. This settlement reinforces our commitment to effectively settle with our partners and
strengthen our operational capabilities. We remain focused on sustaining the positive momentum and creating long-term value for our stakeholders," said Ajay Singh, Chairman and Managing Director, SpiceJet.

Besides this, SpiceJet said it has concluded a similar agreement with Celestial Aviation, a subsidiary of AerCap, one of the largest aircraft lessor groups. The settlement, valued at $29.9 million (Rs 250 Crore), further underscores SpiceJet's dedication to resolving disputes and strengthening its financial position.

Shares of SpiceJet were trading at Rs 64.50, up by 3.07%, at 2.30 PM.

On March 4, SpiceJet said Abu Dhabi’s sovereign wealth fund ADIA has acquired shares of the airline from the open market. "ADIA has acquired shares of the airline from the open market," a SpiceJet spokesperson said on March 4.

The Abu Dhabi Investment Authority recently (late February) acquired shares of the airline from the open market, further underscoring the growing investor interest in SpiceJet, the source said.

The budget carrier is in the process of raising funds. In recent weeks, the carrier has raised a total of Rs 1,060 crore through preferential issuance of securities. On December 12, the airline had said it would raise fresh capital of Rs 2,250 crore.

As of February 21, 2024, public shareholders, including Foreign Portfolio Investors (FPIs), held 51.51 per cent stake in the carrier, the stock exchange page showed.

Last month, Spicejet and Busy Bee Airways have jointly submitted a bid for the bankrupt airline GoFirst. The bid has been submitted by Ajay Singh, in his personal capacity, along with Busy Bee Airways Private Limited, the company said in a press release.

SpiceJet's role as the operating partner for the new airline involves providing essential staff, services, and industry expertise. This collaboration is anticipated to generate synergies between the two carriers, leading to improved cost management, revenue growth, and a strengthened market position within the Indian aviation industry.