According to a regulatory filing, the airline's fundraising board sanctioned the allotment of more than 48.70 crore shares for Rs 61.60 per to the more than 80 QIP parties on September 20.

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SpiceJet raises Rs 3,000cr via qualified institutional placement for financial revival

Published on September 22, 2024

According to a regulatory filing, SpiceJet fundraising board sanctioned the allotment of more than 48.70 crore shares for Rs 61.60 per to the more than 80 QIP parties on September 20.

Struggling airline SpiceJet has raised Rs 3,000 crore through the sale of shares to Qualified Institutional Buyers (QIBs), marking a crucial step in its bid to stabilize its finances and clear outstanding liabilities.

The successful fundraising effort, conducted via a Qualified Institutional Placement (QIP), was oversubscribed, signaling strong interest from investors.

Key Investors in the QIP

Several foreign entities participated in the QIP, with notable investors including Societe Generale – ODI, Goldman Sachs (Singapore) Pte – ODI, Nomura Singapore Ltd ODI, and Discovery Global Opportunity (Mauritius) Ltd.

SpiceJet’s fundraising committee approved the allotment of 48.70 crore shares at Rs 61.60 per share on September 20, distributing the shares to over 80 institutional participants.

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Increase in Paid-Up Equity Capital

As a result of this QIP, SpiceJet’s paid-up equity share capital has increased significantly, rising from Rs 7.94 billion to Rs 12.81 billion, according to a filing with the Bombay Stock Exchange (BSE). This capital boost will help the airline address its mounting financial challenges as it strives to sustain operations.

Utilization of Funds

The Rs 3,000 crore raised from the QIP will primarily be used to settle the airline’s various liabilities. This includes payments to aircraft and engine lessors, engineering vendors, financiers, and other creditors.

The financial relief is crucial for SpiceJet, which has faced multiple operational and financial headwinds after 19 years of service.

Top Investors and Share Allocation

Five investors secured over 5% of the shares in the QIP, with Authum Investment and Infrastructure Ltd leading with a 9.33% stake. Discovery Global Opportunity (Mauritius) Ltd acquired 8.33%, followed by Troo Capital (6.67%), Societe Generale – ODI (6.04%), and Goldman Sachs (Singapore) Pte – ODI (5.33%).

This fundraising move is seen as a significant lifeline for SpiceJet, allowing it to clear dues and regain operational stability amidst industry turbulence.