Lakshmi Mittal winging into SpiceJet?

Bangalore: Lakshmi Niwas Mittal, the London-based billionaire who controls ArcelorMittal, the world’s largest steel company, is believed to have evinced interest in buying ailing low-cost carrier SpiceJet.
“He (Mittal) would like to go for a full buyout,” a source familiar with the development said.
This will require Mittal buying, apart from the promoters’ stake, the $80 million (Rs 350 crore) foreign currency convertible bonds (FCCBs) that SpiceJet issued to Istithmar, the Dubai government’s investment arm, and investment bank Goldman Sachs.
The Tatas hold around 7% stake in the airline. Mittal could not be reached for comment.
Mittal’s interest is a surprise because the airline doesn’t have a strategic fit with his businesses. “It doesn’t make any sense for Mittal to look at SpiceJet,” said an industry source.
On the other hand, liquor and aviation baron Vijay Mallya remains keen on scooping the no-frills carrier to lift Kingfisher’s market share above that of arch rival Jet Airways.
Meanwhile, Wilbur Ross, the US investor often called the ‘King of Bankruptcy’, who is close to Mittal (he is on ArcelorMittal board), wants to rework the terms of his investment in SpiceJet.
Ross had in July announced an investment of Rs 345 crore in the airline. SpiceJet sources insist that deal is not in danger, but they admitted it “may not be sealed on original terms.”
A source familiar with the development said Ross’ return to the negotiating table came after the Airports Authority of India (AAI) issued an ultimatum to SpiceJet to pay up dues or be charged landing and navigational fees on a cash-and-carry basis from August 1.
11/08/08 Praveena Sharma/ DNA MONEY/Sify

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Categories: Foreign Aug 2008, SpiceJet Aug 2008