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UAE sovereign fund ADIA buys SpiceJet shares from open market

Airline says it has also settled a dispute of about $11.2 million with global aircraft leasing firm Cross Ocean Partners

UAE sovereign fund ADIA buys SpiceJet shares from open market
[Source photo: Chetan Jha/Press Insider]

Abu Dhabi Investment Authority (ADIA), the largest sovereign wealth fund in the United Arab Emirates (UAE), has bought shares of SpiceJet Ltd from the market, the Indian no-frills airline said on Tuesday.

ADIA had begun acquiring the airline’s shares beginning late February, Indian media reported on Monday.

The UAE sovereign fund declined to comment on the development, while a SpiceJet spokesperson declined to divulge financial details of the share purchase.

In November last year, SpiceJet was reportedly in talks to raise about $100 million.

Ajay Singh, the airline’s promoter, was in talks with global credit funds to raise the funding, Moneycontrol had reported, citing people aware of the development.

The funds would be used to infuse fresh equity and refinance a part of the promoter debt, the report said.

In January, the airline said it received principal approval from BSE to issue equity shares and warrants convertible into equity shares on a preferential basis, as part of its ₹2,242-crore fund infusion plans.

In a separate development, SpiceJet said on Tuesday that it has settled a dispute of about $11.2 million, or ₹93 crore, with global aircraft leasing firm Cross Ocean Partners.

“The settlement is expected to result in significant savings for SpiceJet. As part of the arrangement, the airline will also benefit from transfer of airframe and an engine at no additional cost, augmenting its operational capabilities,” the airline said in a statement.

In addition to this settlement, SpiceJet had recently reached a similar deal with Celestial Aviation, a subsidiary of another aircraft lessor group AerCap, valued at $29.9 million, or ₹250 crore.

SpiceJet shares rose 2.51% from Monday’s close to ₹64.15 INR at 2pm on Tuesday, while the benchmark Sensex index was down about 0.2%.

Spice Jet operates a fleet of Boeing 737s, Q-400S, and freighters and is considered India’s one of largest regional players operating multiple daily flights under UDAN or regional connectivity scheme.

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