 "SpiceJet resolves $4.5 mn dispute with Shannon Engine support for $2 mn")
Budget airline SpiceJet has successfully settled a long-standing $4.5 million dispute with Shannon Engine Support Limited (SES), agreeing to a reduced settlement of $2 million. The agreement was reached through ‘amicable negotiations’, with both parties opting to conclude the matter out of court. As part of this resolution, all ongoing litigation and disputes between the airline and SES will be withdrawn, signalling a fresh chapter in their business relationship, reported The Economic Times.
This latest settlement is the fourth in a series of significant financial agreements by SpiceJet. On October 15, SpiceJet announced that it had resolved a $23.39 million dispute with Aircastle (Ireland) Designated Activity Company and Wilmington Trust SP Services (Dublin) Limited, reducing its financial obligation to $5 million.
In stock market trading, SpiceJet’s shares fell 3.7 per cent to Rs 54.10 apiece on the Bombay Stock Exchange (BSE), while the BSE Sensex also saw a nearly 1 per cent dip, declining by 750 points. SpiceJet’s stock, however, rebounded from a day’s low of Rs 52.25, reflecting investor sentiment amid these financial settlements.
The airline’s series of settlements follows its successful Rs 3,000 crore fundraise in September through a Qualified Institutional Placement. This capital infusion attracted notable investors such as Goldman Sachs (Singapore), Morgan Stanley Asia, Tata Mutual Fund, and Discovery Global Opportunity Ltd, strengthening SpiceJet’s liquidity position.
On October 9, SpiceJet settled a $131.85 million dispute with lessors Horizon Aviation 1 Ltd, Horizon II Aviation 3 Ltd, and Horizon III Aviation 2 Ltd, managed by Babcock & Brown Aircraft Management, by agreeing to a payment of $22.5 million. Just weeks prior, on September 24, the airline resolved a claim with Engine Lease Finance Corporation (ELFC), which initially stood at $16.7 million, for a lower undisclosed amount.