The Indian low-cost SpiceJet has asked shareholders to approve a plan to exchange $28.16 million debt to an equity lessor, while issuing shares and warrants in exchange for capital to an entity controlled by SpiceJet majority owner and chief executive Ajay Singh.
This week, SpiceJet asked for the go-ahead from shareholders to issue a 5.9% stake to Carlyle Aviation Partners. Last February, Carlyle, which is the largest aircraft rental company of SpiceJet, had decided to convert part of its rights to the airline into shares and mandatory convertible dividends (CCD). He plans to convert contributions of more than $8 million into shares of the airline. The largest of the nine entities is Carlyle Aviation Partners, which is the aircraft finance unit of global private equity giant Carlyle Group. The others include Citrine Aircraft Leasing and Fly Aircraft Holdings.
On August 4, India’s Economic Times reported that SpiceJet’s board of directors has asked shareholders to approve granting Carlyle a 5.91% in the airline. Notably, Carlyle is paying the equivalent of INR 48 Indian rupees (USD 0.58) per share, a premium of more than 50% over SpiceJet’s current share price on the Mumbai Stock Exchange (BSE). Carlyle is to receive shares and mandatory convertible debt.
SpiceJet is the second largest airline in India by number of domestic passengers carried, with a market share of 5.8% as of April 2023. Its passenger fleet today is 65 single-aisle aircraft but expects 194,737 MAX8, part of which will replace the old 737s.