NCLT To Hear Insolvency Proceedings Plea Filed Against SpiceJet On May 8

SpiceJet too seems to be facing headwinds, with a lessor filing a plea seeking insolvency resolution proceedings against the no-frills airline and the petition is scheduled for hearing before the National Company Law Tribunal (NCLT) next week.

It also comes at a time when competitor and cash-starved Go First has cancelled flights and has filed for voluntary insolvency resolution proceedings.

Aircraft lessor Aircastle (Ireland) Ltd has filed the petition against SpiceJet for initiating insolvency resolution proceedings. The plea was filed on April 28 and it is to be heard by the NCLT Principal Bench on May 8, according to an update on the tribunal's website.

A SpiceJet spokesperson said presently, there are no aircraft from this lessor in the airline's fleet and that the development will in no way affect its operations.

"All aircraft from this lessor have already been returned by SpiceJet...

"We are confident of resolving the matter without court proceedings and we are in discussions with their senior leadership team for the same," the spokesperson said in a statement.

Further, the airline spokesperson said the comments provided here are without prejudice to the airline's rights and in no way should be deemed as admission of any liabilities.

Shares of SpiceJet declined 2 per cent to close at Rs 31.93 apiece on the BSE on Friday.

According to the NCLT website, two more petitions for insolvency resolution proceedings against SpiceJet are pending. The plea by Willis Lease Finance Corporation was filed on April 12 and the one by Acres Buildwell Private Ltd was filed on February 4.

There was no immediate comment from SpiceJet on the two petitions.

In February, SpiceJet announced that Carlyle Aviation Partners will acquire a 7.5 per cent stake in the airline by converting outstanding dues as well as snap up shareholding in the cargo business, a move that will help the airline reduce its debt by USD 100 million.

The NCLT on Thursday reserved its order on Go First petition after nearly a four-hour long hearing where aircraft lessors vehemently opposed the airline's plea.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)