SpiceJet to raise $80 mn for fleet expansion
Airline has a fleet of 11 Boeing 737-800s that fly to 14 destinations. It plans to raise its fleet size to 18 by March next year.
By Sudipto Dey, TNN |
NEW DELHI: Low-cost carrier SpiceJet has chalked out plans to raise up to $60-80 million through a mix of equity dilution and debt. This will part finance 10 new aircraft worth around $450 million, the deliveries of which will start in 2009.
SpiceJet recently applied to the US Exim Bank for a $330-350-million loan. If the loan comes through, it will take care of around 80-85% of the fund requirement. For the remaining amount, the company may dilute 10-12% equity to raise around $50 million and resort to debt of $30 million.
However, if the loan from US EXIM Bank does not materialise, the airline may go for sale-lease-buyback to fund its fleet expansion plans.
On this, the company will take a call by October, said a senior company executive.
“We will require between $60-80 million to fund our fleet expansion plans,” SpiceJet CEO Siddhanta Sharma told ET. SpiceJet currently has a fleet of 11 Boeing 737-800 that fly to 14 destinations. It plans to take its fleet size to 18 by March next year. In April, SpiceJet announced plans to acquire 10 737-800s.
Investment banking sources said that the airline has been in talks with a host of private equity players. Dubai-based private equity firm Istithmar, which currently has around 13% stake in the company, is also keen to increase its presence. The Tata Group has 6.9% stake in the airline.
In January, the company raised around Rs 300 crore from a clutch of investors including Goldman Sachs and the Tata Group. In the April-June 2007, SpiceJet reported a net profit of Rs 18.5 crore, riding on gains from foreign exchange fluctuations on outstanding liabilities and sale of two aircraft.
The carrier posted Rs 70 crore in losses on revenues of Rs 748 crore in the June 2006-March 2007 period.
SpiceJet recently applied to the US Exim Bank for a $330-350-million loan. If the loan comes through, it will take care of around 80-85% of the fund requirement. For the remaining amount, the company may dilute 10-12% equity to raise around $50 million and resort to debt of $30 million.
However, if the loan from US EXIM Bank does not materialise, the airline may go for sale-lease-buyback to fund its fleet expansion plans.
On this, the company will take a call by October, said a senior company executive.
“We will require between $60-80 million to fund our fleet expansion plans,” SpiceJet CEO Siddhanta Sharma told ET. SpiceJet currently has a fleet of 11 Boeing 737-800 that fly to 14 destinations. It plans to take its fleet size to 18 by March next year. In April, SpiceJet announced plans to acquire 10 737-800s.
Investment banking sources said that the airline has been in talks with a host of private equity players. Dubai-based private equity firm Istithmar, which currently has around 13% stake in the company, is also keen to increase its presence. The Tata Group has 6.9% stake in the airline.
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In January, the company raised around Rs 300 crore from a clutch of investors including Goldman Sachs and the Tata Group. In the April-June 2007, SpiceJet reported a net profit of Rs 18.5 crore, riding on gains from foreign exchange fluctuations on outstanding liabilities and sale of two aircraft.
The carrier posted Rs 70 crore in losses on revenues of Rs 748 crore in the June 2006-March 2007 period.
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