SpiceJet, the low-cost air carrier, on Thursday got its shareholders' approval to issue additional equity shares to promoter Kalanithi Maran, who in turn will infuse Rs 130 crore (Rs 1.3 billion) into the airline. Maran's equity holding would go up from 38 per cent to 43 per cent of the company's shares.
At the sidelines of its annual general meeting, Neil Raymond Mills, chief executive officer, said: "He (Maran) will be paying 50 per cent more compared to the price quoted in the market. He could have saved Rs 50 crore by buying these shares from the open market, but he was ready to pay the premium, which shows the confidence of the promoter in the airline."
The shares were trading at Rs 22 each on the Bombay Stock Exchange on Thursday, down by 2.65 per cent from yesterday's close.
The fresh shares will be issued by the first week of next month. Mills said the money would help in covering losses, as well as fund expansion.
A senior official from the airline said Canada's export finance agency, Export Development Canada, is funding SpiceJet's purchase of planes and had sanctioned $270 million of credit for this, 85 per cent of the total value for the 11 Q400 turboprop aircraft the company has planned to add by the end of March 2012.
30/09/11 Business Standard/Rediff.com
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