The Board has further directed the Company to take further steps to implement and undertake all necessary steps including to make the appropriate application before the Ministry of Civil Aviation, Government of India.
The News International Team
In yet another twist to Indian aviation story, beleaguered budget carrier SpiceJet announced its decision to transfer the ownership, management and control of the company to co-founder Ajay Singh from Sun Group chairman Kalanithi Maran and Kal Airways. Maran and Kal together held 53.5 percent in Spice while Singh had 4.5 percent stake.
A company press release, issued on Thursday afternoon, said: “The Board has further directed the Company to take further steps to implement and undertake all necessary steps including to make the appropriate application before the Ministry of Civil Aviation, Government of India for seeking approval of the ‘Scheme of Reconstruction and Revival for the takeover of ownership, management and control of SpiceJet Limited’.
The Kalanithi Maran-promoted carrier was allowed to avail credit facility for landing, parking and route navigation fee from the Airports Authority of India for a limited period.
In 2010, when Maran acquired SpiceJet for Rs 750 crore, the airline had cash reserves of more than Rs 450 crore. Subsequently, it faced mounting losses and landed in huge debts. It was severely hit by cash crunch in the last couple of months that threatened its operations. To get by, Spice not only reduced its Boeing plane fleet and ended up losing a considerbale market share.
SpiceJet stock price
On January 15, 2015, SpiceJet closed at Rs 18.65, up Rs 0.55, or 3.04 percent. The 52-week high of the share was Rs 22.20 and the 52-week low was Rs 11.10.
The latest book value of the company is Rs -16.49 per share. At current value, the price-to-book value of the company was -1.13.