Spice Jet Promoters To Infuse Funds To Revive Airlines
Spice Jet, the troubled low cost airline carrier, has assured the Government that its promoters will help in reviving the airline company by infusing fresh funds into the company. A Government official said that, “They (SpiceJet management) have informed us that the airline is getting investments from promoters. They have, however, not specified on the amount that will be invested into the airline.”
The Spice Jet has told the Government officials that the details of the same will be let known through a plan that they will submit to the Government on Monday. This is the deadline date set by the Directorate General of Civil Aviation (DGCA) for Spice Jet to submit their financial plan.
The COO of Spice Jet Sanjiv Kapoor met the Civil Aviation Secretary V Somasundaram at the ministry yesterday. After the meeting, he came out and told reporters that the promoters are committed to the airline and are very much interested in taking it forward. He said that there are a number of solid financial plans in place and that the details will be submitted to the Government officials.
Sanjiv Kapoor said that the dues to the airline are a fraction of Rs. 1,600 crores, but the amount pending to the lessors is just around Rs. 200 crores and not Rs. 700 crores as reported in the media. The amount pegged by the Government is about Rs. 1,630 crores, according to the airline’s filing to DGCA.
There have been calls made to all travel agents through a conference call by Spice Jet’s Senior Vice President and Sales Head Shilpa Bhatia assuring the operators that their dues from the company are safe and a plan will be shared with the travel operators on Monday. A Mumbai based travel agent has confirmed that the company admitted that it is in a major financial crisis at the moment and assured them that they will come out of it as soon as possible.
Last week DGCA ordered Spice Jet to cancel taking advance bookings of flights for more than one month period and also cancelled 186 flight slots due to the financial crisis that the company is in and because the company had to return the aircrafts to leasing companies. The company, which had 42 Boeing 737 fleets now has just 22 flights and their daily flights have reduced from 345 in the month of July to just 262 flights as of this Friday.