On Monday, budget carrier SpiceJet announced that its subsidiary SpiceXpress and Logistics will receive a $100 million investment from UK-based group SRAM & MRAM. The investment comes at a time when SpiceJet is facing financial difficulties and an insolvency plea by an aircraft lessor. The carrier recently hived off SpiceXpress as a separate entity, and last week, it announced its plan to invest $50 million to revive 25 grounded planes.
The investment from SRAM & MRAM Group will provide much-needed relief to SpiceJet. Both parties have signed a Memorandum of Understanding (MoU) as part of the investment deal. The MoU also comes after a debt restructuring agreement between SpiceJet and aircraft lessor Carlyle Aviation Partner. Carlyle Aviation Partner has bought a stake in SpiceXpress at an anticipated future valuation of $1.5 billion (Rs 12,422 crore).
SpiceJet Chairman and Managing Director Ajay Singh expressed his confidence that the $100 million investment will help SpiceXpress to grow further and expand, providing a more streamlined and efficient service to its customers. SRAM & MRAM Group has interests in various sectors, including agricultural and agro-food products, neural networks, artificial intelligence, hedge fund management, hospitality services and solutions, media, and publishing.
The investment from SRAM & MRAM Group is a positive development for SpiceJet, which is facing financial challenges due to the COVID-19 pandemic. Recently, lessors sought deregistration of five SpiceJet planes, a development that also comes against the backdrop of crisis-hit rival Go First shutting down operations and going for resolution proceedings under the insolvency law.
SpiceJet’s stock was trading at Rs 30.27, up 2.33 per cent on BSE. The investment from SRAM & MRAM Group will likely boost the carrier’s stock price and help the company to overcome its financial difficulties. The carrier’s recent decision to invest $50 million to revive grounded planes also shows its commitment to continuing operations and expanding its services in the future.