Cash-strapped budget airline SpiceJet, which has been exploring various means to raise funds for quite some time, today said it is in talks with a few investors to mop up fresh capital.
"We wish to clarify that a few parties have approached us and evinced interest in making investments into the airline as the company has been exploring various options for raising fresh capital," SpiceJet informed the BSE. The budget carrier said it was too early to talk about possible stake sale, an assertion which came amid reports that the Sun Group-promoted airline was selling out as it has been struggling to remain afloat. "Since the deliberations with such prospective investors are at an exploratory and preliminary stage it will be improper to comment on the specifics of any possible stake sale or the valuation of the company at this stage." Media mogul Kalanithi Maran holds 58.4 per cent stake in the Gurgaon-based airline.
SpiceJet Chief Operating Officer Sanjeev Kapoor last week said the process to further recapitalise the airline was on and it was on track to get back in black. "Recapitalisation is the last piece of the turnaround jigsaw puzzle. There is activity going on, but I can't talk about it. We are not allowed to give any more details, but there is activity," Kapoor had said. The carrier, currently restructuring its fleet, aims to have 35 Boeing planes by the end of the current year from 24 now besides 15 Bombardiers. In the past six months, it brought down its Boeing fleet strength by 10 planes to 28.
The airline has also been facing an exodus of senior executives and pilots. SpiceJet had American investor Wilbur Ross as the single largest stakeholder before Maran took over the airline in June 2010. Ross made a USD 80-million investment in 2008 in the airline and sold his 30 per cent stake for USD 127 million in June 2010.
After posting fifth straight quarterly losses, SpiceJet auditors had warned they were not sure about the airline's ability to remain a "going concern". The airline reported a loss of Rs 310 crore in the September quarter, although it was down from Rs 559 crore in the year-ago period. The loss came down due to 15 per cent growth in revenue. For FY14, SpiceJet had reported a record loss of over Rs 1,000 crore.
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