SpiceJet reaches settlement with lessor Celestial Aviation
New Delhi: Budget airline SpiceJet Ltd on Monday informed the National Company Law Tribunal (NCLT) that it has reached a settlement with aircraft lessor Celestial Aviation. The airline has already begun processing some payments under the agreement and requested an additional week to finalize the remaining settlement details. Upon conclusion of all formalities, the lessor has agreed to withdraw the case.
Hearing in the case has been adjourned till April.
In August last year, Celestial Aviation Services initiated insolvency proceedings actions against SpiceJet, citing a failure to pay $29.9 million for leasing nine aircraft.
Celestial Aviation is among five leasing companies that have petitioned the NCLT for the recovery of outstanding payments from SpiceJet. The list includes Willis Lease Finance Corp, Wilmington, Aircastle, and Alterna Aircraft BV Ltd. However, the tribunal has rejected the insolvency applications from Wilmington Trust SP Services (Dublin) in January and Willis Lease Finance in December of the last year.
Alterna Aircraft, an Ireland-based lessor, recently filed an insolvency claim against SpiceJet at the NCLT, demanding the repayment of $11.1 million and £265,000 as mandated by British courts.
The debt-laden airline is embroiled in numerous legal disputes with creditors over unpaid bills.
On 22 February, the Delhi high court directed SpiceJet to clear $2 million of its liabilities to engine lessors EAM France 01 SAS and Sunbird France 02 SAS. Additionally, the Supreme Court has directed SpiceJet to settle $1.25 million with Credit Suisse by 15 March, mandating the airline’s chairman Ajay Singh to appear in court a week after the payout.
Last week, cash-strapped SpiceJet secured an additional ₹316 crore in funding, bringing the total raised through its preferential issue to ₹1,060 crore. This funding will enable the struggling airline to pursue expansion plans and settle its dues with various creditors.
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Published: 26 Feb 2024, 12:42 PM IST
Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.