SpiceJet receives notice from NCLT for insolvency claim

SPICEJET

The National Company Law Tribunal has issued a notice to SpiceJet on an insolvency plea and directed the domestic budget carrier to respond to it within two weeks.

The NCLT issued the notice to SpiceJet based on an application filed by one of the operational creditors of the airlines — Acres Buildwell Pvt Ltd. The company claims that outstanding dues to the tune of INR 3.25 crores are owed to it by SpiceJet.

The NCLT, in an order passed on September 2, had granted SpiceJet two weeks to file its reply on the plea as to why insolvency resolution proceedings should not be initiated against it. The case is likely to be heard next on September 30.

ALSO READ – SpiceJet settles financial dispute with Credit Suisse AG

SPICEJET
SpiceJet receives notice from NCLT regarding an insolvency claim

Earlier this year, SpiceJet had reached a settlement with Credit Suisse AG which had sought the winding up of the airline over unpaid dues. The airline had reached an in-principle settlement with Credit Suisse AG over pending dues of USD 24 million.

On January 11, a division bench of the Madras High Court upheld a single-judge order passed on December 7, 2021, which directed the liquidation of the private airline and asked the official liquidator to take over the airline’s assets. On January 28, the Supreme Court halted the winding up of the airline and asked it to clear its dues at the earliest.

ALSO READ – Spicejet looking for a “knight in shining armour” to help with financial distress

SpiceJet had recently informed that it is in talks with bankers to raise as much as USD 200 million in fresh capital and that promoter Ajay Singh, who owns a nearly 60% stake in the airline, has been approached by a ‘big Middle Eastern airline’ and a big Indian business conglomerate for a stake in the airline.

Earlier this year, SpiceJet had reached a settlement with Credit Suisse AG which had sought the winding up of the airline over unpaid dues.

ALSO READ – SpiceJet in active discussion with a Middle Eastern carrier for a possible stake sale

Further, the airline has also received approval for a loan under the central government’s Emergency Credit Line Guarantee Scheme (ECLGS). It will reportedly receive around INR 225 crore under the scheme.

ALSO READ – SpiceJet set to receive funds through ECGLS, an extension of up to 3 months for AGM’22

SpiceJet reported a net loss of INR 789 crore for the quarter ending June 30, 2022, as compared to a net loss of INR 729 crore in the quarter ending June 30, 2021, as business was severely impacted by record high fuel prices and a depreciating rupee.

ALSO READ – Worst nightmare of SpiceJet – From financial losses widening to the CFO resigning to non-payment of salaries

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