Sunday, December 20, 2020

SpiceJet seeks one-time restructuring of debt

Mumbai: To tide over the pandemic-led disruptions, stressed low-cost airline SpiceJet has sought a one-time debt restructuring, apart from ₹500-crore in a working capital loan, from YES Bank. It has also submitted a revival plan and its financial documents to the private bank.

Ajay Singh-led SpiceJet has submitted the restructuring proposal per the guidelines issued by the KV Kamath committee and announced by the RBI in September.

“In an emailed communication to YES Bank, SpiceJet proposed a one-time debt restructuring under RBI guidelines to stay afloat. It will also require ₹500 crore of working capital. Its top management has had a meeting with the Aviation Minister for consideration (of the requests),” said a source.

The airline is understood to have approached YES Bank in November-end. BusinessLine has also learned that there was a meeting with the top bank officials, too. In its emailed response dated December 2, YES Bank said it had held discussions regarding the “restructuring proposal and additional working capital requirement of ₹500 crore under the RBI Covid-19 one-time debt restructuring scheme”. A copy of the email has been reviewed by BusinessLine.

“YES Bank has responded to SpiceJet stating that its request is being evaluated and will be considered after due diligence of its financial position,” said one of the sources.

Though the bank hasn’t given a timeline, the officials said due-diligence by external agencies takes time. “We are currently evaluating the company’s financial and business revival plan,” the bank added.

20/12/20 Forum Gandhi/Business Line

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