Updated: 3wk delay: High Court to liquidate SpiceJet in 14 days

TexasAirCorp · Tue Dec 07, 2021 8:58 pm

India's Madras High Court has requested the appointment of a liquidator to SpiceJet after it failed to pay a $24 million debt to a Swiss maintenance firm.

As part of a plea deal, the court has said that if SpiceJet is able to make a payment of over $4 million within the next fortnight, it will throw out the order and allow the company to continue trading. No word on whether that has happened or is able to happen at this stage.

https://www.thehindu.com/news/national/ ... 875098.ece

2175301 · Tue Dec 07, 2021 9:25 pm

Sounds like a fast and fair bankruptcy process; unlike some of the others in the last few years.

LHAM · Tue Dec 07, 2021 10:08 pm

That would be bad news for the MAX.
Spice jet is Boeing's largest customer in India having a standing order for 205 frames.

IceCream · Tue Dec 07, 2021 10:32 pm

Quite a few airlines in India have been going bankrupt these past few years.

lightsaber · Tue Dec 07, 2021 11:08 pm

Well, this is interesting. I knew SpiceJet was losing money, but not that money was this tight. Anyone have a link to recent financial performance?

LHAM wrote:
That would be bad news for the MAX.
Spice jet is Boeing's largest customer in India having a standing order for 205 frames.

With Jet not flying, this would effectively remove the MAX from India domestic opperations.

Lightsaber

MIflyer12 · Tue Dec 07, 2021 11:18 pm

2175301 wrote:
Sounds like a fast and fair bankruptcy process; unlike some of the others in the last few years.

That depends on what priorities are:

- keeping it as a going concern to pay creditors (all creditors, not just the Swiss maintenance firm)

- maintaining employment

- maintaining frequency on airport pairs

- keeping competition in the market

(Other) airline employees just love to see competition disappear.

REDHL · Wed Dec 08, 2021 1:08 am

SpiceJet will appeal the order.

https://www.newindianexpress.com/states ... 93050.html
https://www.business-standard.com/artic ... 039_1.html

EBT · Wed Dec 08, 2021 1:15 am

lightsaber wrote:
Well, this is interesting. I knew SpiceJet was losing money, but not that money was this tight. Anyone have a link to recent financial performance?

LHAM wrote:
That would be bad news for the MAX.
Spice jet is Boeing's largest customer in India having a standing order for 205 frames.

With Jet not flying, this would effectively remove the MAX from India domestic opperations.

Lightsaber

This relates to debts accured in 2011, and SR Technics then on-sold the debt to Credit Suisse, which is the one taking the court action against SpiceJet. The carrier has had a history of racking up debts, delaying payments and annoying the heck out of creditors for years, and in 2014 it temporarily had to suspend operations for a few hours after their fuel supplier refused them credit terms. What saved them then was the collapse of Jet Airways, as well as some strings being pulled int the background.

Nowadays I'm not as close to the pulse of Spice, but it seems that at the start of the pandemic they were heavily impacted, but things may have smoothed out now. Assuming that Spice makes the $5 million payment within the deadline period they will be fine for now.

airsmiles · Wed Dec 08, 2021 7:24 am

They have 205 MAX on order, yet can’t clear a $24m debt from years ago? Aren’t they also planning to start long-haul operations? There’s something very wrong with their finances.

sfojvjets · Wed Dec 08, 2021 7:36 am

airsmiles wrote:
They have 205 MAX on order, yet can’t clear a $24m debt from years ago? Aren’t they also planning to start long-haul operations? There’s something very wrong with their finances.

Agreed. They said they cut a deal with Boeing regarding MAX compensation, and they are receiving two 777s in return. How incredibly short-sighted, when they could instead have gotten financial compensation. What are they going to do with two old 777s when they're bankrupt? And what kind of 777 pilots are going to apply to an airline that is likely going to enter administration, and will lose their jobs as a result??

RobK · Wed Dec 08, 2021 9:19 am

LHAM wrote:
That would be bad news for the MAX.
Spice jet is Boeing's largest customer in India having a standing order for 205 frames.

I don' t think Maxes will be happening. SMBC are taking over at least some of their order to lease to new customers.

BawliBooch · Wed Dec 08, 2021 11:17 am

lightsaber wrote:
Well, this is interesting. I knew SpiceJet was losing money, but not that money was this tight. Anyone have a link to recent financial performance?

This was being talked about for months on Social Media! Their staff has not been paid (or only partly paid) for months now. Dues from Catering and Ground handling contractors have also not been paid. They have not been refunding passengers for cancelled flights for months - in some cases over a year! Fuel bills have not been paid as well. The only reason the airline is still flying is because the current owner is best friends with the Govt and State owned fuel companies continue to refuel the airline. In 2014, under a different owner, the same fuel companies had put the airline on "cash and carry" effectively grounding the airline.

Just like it was with Kingfisher for almost 3-4 years, you wont find any reporting of actuals in the Indian media right until the very end. Thats just the way it works. If it werent for this damning High Court order, people would still be believing the words of some av-bloggers! Read the full text of the HC order - damning indictment of the airline!

Two quick clarifications -
- SpiceJet have 3 weeks to challenge the order in a Higher court. They should manage to get a stay.
- They have to deposit $5million out of the $24 million to the Credit Suisse within 10 days. They will find this difficult given their precarious cash flow situation.

SpiceJet lawyers presented an interesting defense for non-payment - SG lawyers argued that the company SR Technics was not licensed by Indian DGCA to maintain Indian registered aircraft between 2009 and 2015 and hence they were not liable to pay any dues for the period! Ingenious!

This despite the fact that SpiceJet previously acknowledged the dues and promised to pay in 2011 and 2014! This hilarious defense would mean that SpiceJet was flying planes being maintained by an unlicensed contractor!

Time for a suo-moto action against the airline based on their ridiculous submission!

RobK · Wed Dec 08, 2021 11:22 am

Ouch! Are we likely to see SG go the same way as 9W in 2022 then do you think? Seems like history is repeating itself.

BawliBooch · Wed Dec 08, 2021 11:31 am

High Court orders winding up of SpiceJet, directs Liquidator to takeover assets

Fair use quote from story:

The court was allowing a company petition from Credit Suisse AG, a stock corporation registered under the laws of Switzerland, which prayed for winding up of the Indian firm under the provisions of the Companies Act, 1956 and appoint the Official Liquidator of the High Court as the Liquidator with all powers under Section 448 of the Companies Act to take charge of SpiceJet's assets, properties, stock in trade and books of accounts.

The "respondent company (SpiceJet) has miserably failed to satisfy the three pronged test suggested by the Supreme Court in Mathusudan Govardhandas & Co. v. Madhu Woollen Industries (P) Ltd., and hence had rendered itself liable to be wound up for its inability to pay its debts under Section 433 (e) of the Companies Act 1956," Justice R Subramanian said in his order on Monday and directed the private carrier be wound up and the official liquidator take over its assets.

According to the petitioner, SpiceJet had availed of the services of SR Technics, Switzerland, for maintenance, repair and overhauling of aircraft engines, modules, components, assemblies and parts, which are mandatory for its operations. An agreement for performance of such services for a period of 10 years was entered into between SpiceJet and SR Technics on November 24. 2011.

The terms of payments were also agreed. On August 24, 2012 a supplemental agreement was also entered into to change certain terms of the agreement. The amendments included extension of time for payment of money due under various invoices and also a deferred payment scheme. Since there was a general increase in the cost, the 2012 supplemental agreement included adjustment of flight hour rates and provisions for escalation were also made.

Upon provision of the services under the agreement, SR Technics had raised invoices and SpiceJet had issued seven bills of exchange for the monies due under the invoices. It also acknowledged the debts from time to time by issuing certificates of acceptance in relation to the bills of exchange which would imply the respondent had not disputed the correctness of the claim made in the invoices.

The above clause would make it very clear that while it was open to SpiceJet to terminate the contract for the reason that SR Technics did not have a valid authorisation, the termination by itself would not relieve SpiceJet of the obligations that arose under the contract prior to such termination becoming effective. Admittedly, SpiceJet had not chosen to terminate the contract. It had continued to avail the services.

"Therefore in my opinion, it cannot now turn around and say, there is a violation of the provisions of the Aircraft Act or the C.A.R. Rules made there under and therefore the liability ceased. I thus find that the respondent Company has miserably failed to satisfy the three pronged test suggested by the Hon'ble Supreme Court in Mathusudan Govardhandas & Co. v. Madhu Woollen Industries (P) Ltd., supra, and hence had rendered itself liable to be wound up for its inability to pay its debts under Section 433 (e) of the Companies Act 1956. I am therefore of the opinion that this Company Petition should be allowed and the respondent Company directed to be wound up. The Official Liquidator is directed to take over the assets of the respondent Company," the judge said.

DAMNING!

TexasAirCorp · Wed Dec 08, 2021 4:22 pm

REDHL wrote:
SpiceJet will appeal the order.

https://www.newindianexpress.com/states ... 93050.html
https://www.business-standard.com/artic ... 039_1.html

BawliBooch wrote:
SpiceJet lawyers presented an interesting defense for non-payment - SG lawyers argued that the company SR Technics was not licensed by Indian DGCA to maintain Indian registered aircraft between 2009 and 2015 and hence they were not liable to pay any dues for the period! Ingenious!

This despite the fact that SpiceJet previously acknowledged the dues and promised to pay in 2011 and 2014! This hilarious defense would mean that SpiceJet was flying planes being maintained by an unlicensed contractor!

I find it insane that they're choosing to appeal, surely it would just be so much easier (and probably cheaper) to just pay up. If they seriously cannot pay $4 million, how the hell are they still flying?

TexasAirCorp · Wed Dec 08, 2021 4:26 pm

sfojvjets wrote:
airsmiles wrote:
They have 205 MAX on order, yet can’t clear a $24m debt from years ago? Aren’t they also planning to start long-haul operations? There’s something very wrong with their finances.

Agreed. They said they cut a deal with Boeing regarding MAX compensation, and they are receiving two 777s in return. How incredibly short-sighted, when they could instead have gotten financial compensation. What are they going to do with two old 777s when they're bankrupt? And what kind of 777 pilots are going to apply to an airline that is likely going to enter administration, and will lose their jobs as a result??

I think Boeing reckons they're gonna be out of business in a few months, and knew they'd be stupid enough to take new planes instead of cash. If (or should I say, when) they do go bust, Boeing can just write off the order and get out of paying compensation.

Captaincurious · Thu Dec 09, 2021 7:37 am

sfojvjets wrote:
airsmiles wrote:
They have 205 MAX on order, yet can’t clear a $24m debt from years ago? Aren’t they also planning to start long-haul operations? There’s something very wrong with their finances.

Agreed. They said they cut a deal with Boeing regarding MAX compensation, and they are receiving two 777s in return. How incredibly short-sighted, when they could instead have gotten financial compensation. What are they going to do with two old 777s when they're bankrupt? And what kind of 777 pilots are going to apply to an airline that is likely going to enter administration, and will lose their jobs as a result??

Don't really understand the logic foe getting two 777s. There must be some under the table deal.

astuteman · Thu Dec 09, 2021 9:23 am

LHAM wrote:
That would be bad news for the MAX.
Spice jet is Boeing's largest customer in India having a standing order for 205 frames.

One would assume that those frames are already identified in the ASC606 order reductions on the Boeing website...
Not good news, as you say, but "known".
Rgds

BawliBooch · Thu Dec 09, 2021 12:11 pm

sfojvjets wrote:
Agreed. They said they cut a deal with Boeing regarding MAX compensation, and they are receiving two 777s in return. How incredibly short-sighted, when they could instead have gotten financial compensation. What are they going to do with two old 777s when they're bankrupt? And what kind of 777 pilots are going to apply to an airline that is likely going to enter administration, and will lose their jobs as a result??

The source for "Boeing giving SpiceJet 2 777s as compensation for MAX" is Ajay Singh himself briefing reporters on a special MAX re-introduction to service flight. The man made a big deal in the Indian media over dragging Boeing to court for compensation. I see this announcement as a face saving move.

As I asked in the thread discussing SpiceJet 777s - Has Boeing confirmed independently that they have given SpiceJet 2 777s as MAX compensation?

TexasAirCorp wrote:
I find it insane that they're choosing to appeal, surely it would just be so much easier (and probably cheaper) to just pay up. If they seriously cannot pay $4 million, how the hell are they still flying?

Total due to Credit Suisse via SRTechnic is $24 million! SpiceJet have to deposit $5 million within next 2 weeks and can challenge the liquidation verdict after that!

As to whether they can afford it, SpiceJet has not been paying its contractors and even its staff for over a year now. Payment defaults started even before the COVID mess - way back in 2018 infact. All this while, some av-bloggers were spinning obedient lies which were being passed off as fact!

Remember how so many crooks from Niirav Modi to Mehul Choksi to Vijay Mallya of KingFisher fled the country after defrauding taxpayers and investors to the tune of 1000s of crores and now sit sipping Champagne in their luxury homes in UK and Bahamas while the people they cheated backhome languish in penury?

Ajay Singh of Spicejet owes 1000s of crores to Indian state owned banks, contractors, state owned and private oil companies as well as staff. At the very least, the CEO Ajay Singh should be prevented from leaving the country and his passport impounded to ensure he doesnt flee.

BawliBooch · Thu Dec 09, 2021 12:34 pm

The extent to which Vijay Mallya "gamed" the system to raise funds was not known then. He and his airline Kingfisher failed nevertheless. But Vijay Mallya escaped punishment by fleeing to London where he lives in luxurious exile. Ditto with Niirav Modi, Mehul Choksi and a dozen others. It is the poor unpaid contractors and employees who suffered!

SpiceJet is a similar case. Textbook! Their cash flow situation was the worst of all airlines in India. They should have been dead Four years ago - even before Jet! They survived! How did Ajay Singh manage to raise cash while Naresh Goyal failed? Did SpiceJet promoters game the system in the same way as Mallya or Niirav Modi? There should be an investigation. But this time lock the door first so the culprit does not flee!

Breathe · Thu Dec 09, 2021 12:35 pm

BawliBooch wrote:
sfojvjets wrote:
Agreed. They said they cut a deal with Boeing regarding MAX compensation, and they are receiving two 777s in return. How incredibly short-sighted, when they could instead have gotten financial compensation. What are they going to do with two old 777s when they're bankrupt? And what kind of 777 pilots are going to apply to an airline that is likely going to enter administration, and will lose their jobs as a result??

The source for "Boeing giving SpiceJet 2 777s as compensation for MAX" is Ajay Singh himself briefing reporters on a special MAX re-introduction to service flight. The man made a big deal in the Indian media over dragging Boeing to court for compensation. I see this announcement as a face saving move.

As I asked in the thread discussing SpiceJet 777s - Has Boeing confirmed independently that they have given SpiceJet 2 777s as MAX compensation?

TexasAirCorp wrote:
I find it insane that they're choosing to appeal, surely it would just be so much easier (and probably cheaper) to just pay up. If they seriously cannot pay $4 million, how the hell are they still flying?

Total due to Credit Suisse via SRTechnic is $24 million! SpiceJet have to deposit $5 million within next 2 weeks and can challenge the liquidation verdict after that!

As to whether they can afford it, SpiceJet has not been paying its contractors and even its staff for over a year now. Payment defaults started even before the COVID mess - way back in 2018 infact. All this while, some av-bloggers were spinning obedient lies which were being passed off as fact!

Remember how so many crooks from Niirav Modi to Mehul Choksi to Vijay Mallya of KingFisher fled the country after defrauding taxpayers and investors to the tune of 1000s of crores and now sit sipping Champagne in their luxury homes in UK and Bahamas while the people they cheated backhome languish in penury?

Ajay Singh of Spicejet owes 1000s of crores to Indian state owned banks, contractors, state owned and private oil companies as well as staff. At the very least, the CEO Ajay Singh should be prevented from leaving the country and his passport impounded to ensure he doesnt flee.

Got any links?

Vimanav · Thu Dec 09, 2021 12:38 pm

Liquidation... huh?

Never forget that this airline was the original ModiLuft...

and it still is...

so yeah, nothings going to happen to it.

Cheers//Vimanav

hpff · Thu Dec 09, 2021 2:55 pm

TexasAirCorp wrote:
I find it insane that they're choosing to appeal, surely it would just be so much easier (and probably cheaper) to just pay up. If they seriously cannot pay $4 million, how the hell are they still flying?

Not entirely sure about the Indian legal system but the court apparently directed a liquidator, so appealing means they get at least a couple more weeks of operation/time to come up with the money. They currently need to deposit $5m with the court within two weeks.

Phosphorus · Thu Dec 09, 2021 3:43 pm

Not sure how would this work. If other angry creditors show up -- are they expected to file separate suits, or can they file parallel claims within this same court case?
Logically, while it was a commercial claim of one company to another -- the answer must be "no". But the court ruling contains words "liquidator" and "winding up the company" -- and these are bound to affect more than these two companies?

BawliBooch · Fri Dec 10, 2021 12:52 am

Vimanav wrote:
Liquidation... huh?

Never forget that this airline was the original ModiLuft...

and it still is...

so yeah, nothings going to happen to it.

Cheers//Vimanav

ModiLuft was owned by SK Modi with a technical partnership with Lufthansa. It evolved into Royal Airways which was bought by Ajay Singh. SpiceJet AOC may survive in another avatar. SpiceJet might find new owners and fly again - perhaps Adani can make a bid so it stays within the family! But Ajay Singh's career in aviation and life as a free man are both effectively over.

Breathe wrote:
Got any links?

The link to the court case proceedings was already posted a little earlier in this very thread. For the rest, Google is your friend!

FluidFlow · Fri Dec 10, 2021 2:55 pm

Phosphorus wrote:
Not sure how would this work. If other angry creditors show up -- are they expected to file separate suits, or can they file parallel claims within this same court case?
Logically, while it was a commercial claim of one company to another -- the answer must be "no". But the court ruling contains words "liquidator" and "winding up the company" -- and these are bound to affect more than these two companies?

I think at the moment it is a dispute between CS (as they seem to be the depth holder) and SpiceJet. It seems that CS makes the case that if SpiceJet can not pay the depth partially in the next 2 weeks, they should be liquidated as they defunct on their debt. The moment a liquidator is appointed every other depth holder can jump on the band wagon and try to carve out their piece of cake. At the moment though I do not think the legislation allows for other depth holders to jump on the same case.

So for SpiceJet to stay out of more trouble it will be better to bring that money to the court because otherwise the lights might go out for good (or at least for a while until everything is solved).

Breathe · Fri Dec 10, 2021 3:00 pm

BawliBooch wrote:
Vimanav wrote:
Liquidation... huh?

Never forget that this airline was the original ModiLuft...

and it still is...

so yeah, nothings going to happen to it.

Cheers//Vimanav

ModiLuft was owned by SK Modi with a technical partnership with Lufthansa. It evolved into Royal Airways which was bought by Ajay Singh. SpiceJet AOC may survive in another avatar. SpiceJet might find new owners and fly again - perhaps Adani can make a bid so it stays within the family! But Ajay Singh's career in aviation and life as a free man are both effectively over.

Breathe wrote:
Got any links?

The link to the court case proceedings was already posted a little earlier in this very thread. For the rest, Google is your friend!

I was referring to your quote regarding links to what av-bloggers had said:

" All this while, some av-bloggers were spinning obedient lies which were being passed off as fact!

Spiderguy252 · Fri Dec 10, 2021 6:48 pm

SpiceJet seems such a terribly run operation that I wouldn't mind in the slightest as a passenger if they were to go away.

They're not a feather on IndiGo.

Vicenza · Fri Dec 10, 2021 8:30 pm

MIflyer12 wrote:
2175301 wrote:
Sounds like a fast and fair bankruptcy process; unlike some of the others in the last few years.

That depends on what priorities are:

- keeping it as a going concern to pay creditors (all creditors, not just the Swiss maintenance firm)

- maintaining employment

- maintaining frequency on airport pairs

- keeping competition in the market

(Other) airline employees just love to see competition disappear.

'Priorities'should not even be considered, or come into it. This airline has been reneging on it'd debts for years, including not paying it's employee's. Liquidate it.

avier · Sat Dec 11, 2021 4:40 am

BawliBooch wrote:
ModiLuft was owned by SK Modi with a technical partnership with Lufthansa. It evolved into Royal Airways which was bought by Ajay Singh. SpiceJet AOC may survive in another avatar. SpiceJet might find new owners and fly again - perhaps Adani can make a bid so it stays within the family! But Ajay Singh's career in aviation and life as a free man are both effectively over.

The airline would need to survive in some form or the other, under a new ownership and management in place.
If they were to disappear, it would only mostly benefit the blue airline the most; getting all their lucrative slots at airports, the prized Udan routes of SG, and their Int'l flying rights to the Gulf & S.E Asia. Holding +55% market share is scary, and with SG gone, it would easily go past 60% for the blue airline.
Seeing the ego of Indian airline promoters though, it seems they'd rather let their airline shutdown than have anyone else take control of it. It's more like: it can only be mine, and no one else's.

BawliBooch · Sat Dec 11, 2021 12:45 pm

avier wrote:
Seeing the ego of Indian airline promoters though, it seems they'd rather let their airline shutdown than have anyone else take control of it. It's more like: it can only be mine, and no one else's.

Ajay Singh does not seem like the emotional type though.

Naresh had the "proud daddy" emotional problem when it came to Jet. Ajay Singh is more of a hard nosed bania - will take the best deal he can get and bail. The alternative in his case could be jail time or life in exile like Vijay Mallya.

Indeed, Ajay Singh did bail out once before. He had correctly predicted his inability to compete against the big bad blue wolf and bailed out by selling the airline to the Marans. Then inexplicably in 2014, he played the same skullduggery he had earlier displayed with Royal Airways/ModiLuft to force the Marans to sell the airline back to him! Perhaps he thought that with the good friend he helped get elected in high office, things would be easier.

Apparently not!

edealinfo · Sat Dec 11, 2021 5:13 pm

Vicenza wrote:
Liquidate it.

Not happening and you know it.

BawliBooch wrote:
Ajay Singh does not seem like the emotional type though. Naresh had the "proud daddy" emotional problem when it came to Jet. Ajay Singh is more of a hard nosed bania - will take the best deal he can get and bail!

That's what you call hitting the nail on the head (as the expression goes).

avier wrote:
1. Perhaps Adani can make a bid so it stays within the family!
2. getting the prized Udan routes of SG.

1. Ha ha, good one
2. What are these routes, specifically?

TexasAirCorp · Sat Dec 11, 2021 9:32 pm

MIflyer12 wrote:
- keeping it as a going concern to pay creditors (all creditors, not just the Swiss maintenance firm)

It's been kept as a going concern since 2014 yet it's paid barely any of its creditors. The only way creditors will see a penny from SpiceJet is if the court or a liquidator gets involved.

BawliBooch · Sun Dec 12, 2021 12:26 am

Perhaps the Govt can step in and buy out SpiceJet! Sections within the Govt are keen to have a "national" airline. Instead of working to build a new one on the Indian Airlines AOC/brand, they can just buy SpiceJet and rebrand it! Voila!

Ajay Singh gets a good price and perhaps gets to stay on as CEO. Govt gets a national airline with which to dispense favors. Everybody wins!

Except the Indian taxpayer!

*sarcasm

TexasAirCorp · Sun Dec 12, 2021 4:08 pm

BawliBooch wrote:
Perhaps the Govt can step in and buy out SpiceJet! Sections within the Govt are keen to have a "national" airline. Instead of working to build a new one on the Indian Airlines AOC/brand, they can just buy SpiceJet and rebrand it! Voila!

Ajay Singh gets a good price and perhaps gets to stay on as CEO. Govt gets a national airline with which to dispense favors. Everybody wins!

Except the Indian taxpayer!

*sarcasm

Wouldn't put it past them, Air India Express was profitable after all!

zuckie13 · Sun Dec 12, 2021 7:52 pm

Clearly what is going to happen is the same guys who bought Jet Airways will also by Spice Jet. The result, a new powerhouse - "Spice Jet Airways" - takes hold and lays waste to IndiGo.....
Also the worlds most creative accounting is invented....

DIJKKIJK · Sun Dec 12, 2021 8:18 pm

BawliBooch wrote:
Perhaps the Govt can step in and buy out SpiceJet! Sections within the Govt are keen to have a "national" airline. Instead of working to build a new one on the Indian Airlines AOC/brand, they can just buy SpiceJet and rebrand it! Voila!

Ajay Singh gets a good price and perhaps gets to stay on as CEO. Govt gets a national airline with which to dispense favors. Everybody wins!

Except the Indian taxpayer!

*sarcasm

Nationalising a private company? In this day and age?

I've come across cases of fertile imagination, but this takes not just the cake but the entire bakery.

JayinKitsap · Mon Dec 13, 2021 6:31 am

Wouldn't Air India, now owned by Tata, love to see SpiceJet cease operations. It would likely raise prices of tickets and provides a chance to gain market share. Indian aviation always seems to be high drama, plenty of shooting stars that burn out in spectacular fashion.

BawliBooch · Mon Dec 13, 2021 11:46 am

DIJKKIJK wrote:

Nationalising a private company? In this day and age?

I've come across cases of fertile imagination, but this takes not just the cake but the entire bakery.

Did you miss the *sarcasm?!

But hold that thought!

Exeiowa · Mon Dec 13, 2021 3:08 pm

Curious if Spice Jets woes have had an effect on people buying tickets? You can do a lot of things to keep things going as long as their is some money coming in the door. If that dries up magical accounting becomes a lot harder.

TexasAirCorp · Fri Jan 28, 2022 3:04 pm

Surprise surprise, 14 days is up and SpiceJet failed to make payment.

The court has, in my opinion, been pretty generous and now given a three-week window to negotiate some sort of agreement with Credit Suisse. If they fail to reach a settlement, liquidation will again be put on the table.

Interestingly, the Airports Authority of India held a senior meeting yesterday to discuss SpiceJet's financial standing and find a way to cushion themselves if SG does indeed end up being liquidated. Not a good sign.

https://www.ch-aviation.com/portal/news ... ation-case

davidjohnson6 · Fri Jan 28, 2022 3:33 pm

15 years ago, Jet Airways (plus JetLite), Kingfisher, and SpiceJet seemed like the airlines one would choose to fly. Air India was regarded as a disaster just waiting for bankruptcy
To lose one major airline is unlucky, to lose two is maybe just coincidence, but to lose potentially 3 major airlines takes some effort

lightsaber · Fri Jan 28, 2022 5:47 pm

SpiceJet called the bluff and won. I would imagine in the current travel climate they are losing money fast. While the following link has interesting words from the judge, I'm not certain it means anything short term

https://www.republicworld.com/amp/india ... eshow.html

https://www.republicworld.com/amp/india ... eshow.html

As already noted: Kingfisher, Jet, and now SpiceJet. That seems rather careless...

“To lose one parent, Mr. Worthing, may be regarded as a misfortune; to lose both looks like carelessness.” ― Oscar Wilde
https://www.goodreads.com/quotes/3067-t ... %20parents

Somehow Air India survived. I hope that proves to be the wise policy.

Lightsaber

BawliBooch · Sat Jan 29, 2022 12:47 am

lightsaber wrote:
SpiceJet called the bluff and won.

Lightsaber

Errr...NO! The SC order came with a stinger. The Court reprimanded SpiceJet for its delaying tactics.

"THIS IS NOT THE WAY TO RUN AN AIRLINE" end quote.

The stay order from the SC was a given - There was no other alternative. Creditors other that Credit Suisse are also lining up to collect their dues and file their own cases which would become impossible if SpiceJet is liquidated now. So in a sense, the SC stay order for 3 weeks gives these other creditors time to file their own claims.

Indeed, a couple of creditors have already filed for encashing SpiceJet's bank guarantees - a sign of the end! The only reason this airline is still flying is that unlike in May 2014, state owned fuel companies continue to fuel Spice planes on credit instead of putting them on cash and carry. Staff and Crew are unpaid or only partly paid. They cant pull these stunts with expat crew, so like with Kingfisher, these expat crew are being retrenched. In separate court verdicts, SpiceJet has faced setbacks in their attempts to deny what they call "contractual crew" benefits.

Cardude2 · Sat Jan 29, 2022 1:10 am

so what happens now?

TexasAirCorp · Sat Jan 29, 2022 1:17 am

Cardude2 wrote:
so what happens now?

Now SpiceJet has three weeks to either pay its debts or try and get Credit Suisse to allow it to pay later. Something tells me CS won't be too keen to budge.

If that fails, it's back to the court and CS will most likely push for liquidation.

edealinfo · Sat Jan 29, 2022 3:42 am

avier wrote:
BawliBooch wrote:
ModiLuft was owned by SK Modi with a technical partnership with Lufthansa. It evolved into Royal Airways which was bought by Ajay Singh. SpiceJet AOC may survive in another avatar. SpiceJet might find new owners and fly again - perhaps Adani can make a bid so it stays within the family! But Ajay Singh's career in aviation and life as a free man are both effectively over.

The airline would need to survive in some form or the other, under a new ownership and management in place.
If they were to disappear, it would only mostly benefit the blue airline the most; getting all their lucrative slots at airports, the prized Udan routes of SG, and their Int'l flying rights to the Gulf & S.E Asia. Holding +55% market share is scary, and with SG gone, it would easily go past 60% for the blue airline.
Seeing the ego of Indian airline promoters though, it seems they'd rather let their airline shutdown than have anyone else take control of it. It's more like: it can only be mine, and no one else's.

1) why are you afraid to name Indigo?
2) please specify the prized Udan routes of SG?

edealinfo · Sat Jan 29, 2022 3:43 am

TexasAirCorp wrote:
Surprise surprise, 14 days is up and SpiceJet failed to make payment.

The court has, in my opinion, been pretty generous and now given a three-week window to negotiate some sort of agreement with Credit Suisse. If they fail to reach a settlement, liquidation will again be put on the table.

Interestingly, the Airports Authority of India held a senior meeting yesterday to discuss SpiceJet's financial standing and find a way to cushion themselves if SG does indeed end up being liquidated. Not a good sign.

https://www.ch-aviation.com/portal/news ... ation-case

I bet they won't get liquidated.

DIJKKIJK · Sat Jan 29, 2022 9:21 am

TexasAirCorp wrote:
Cardude2 wrote:
so what happens now?

Now SpiceJet has three weeks to either pay its debts or try and get Credit Suisse to allow it to pay later. Something tells me CS won't be too keen to budge.

If that fails, it's back to the court and CS will most likely push for liquidation.

And the dimwits at SpiceJet were bidding for Air India :lol:

I'm happy that the court has come down so heavily on them. India has had more airlines going bust than any other country, all thanks to clueless businesspeople starting airlines only to fuel their hubris. They've ruined the aviation scene in the country and India's airports are littered with rotten carcasses of their stupidity.

It's about time someone gave these arrogant fools a reality check. Airlines should be started only by people who can run them.

hohd · Mon Jan 31, 2022 3:07 pm

DIJKKIJK wrote:
India has had more airlines going bust than any other country, all thanks to clueless businesspeople starting airlines only to fuel their hubris. They've ruined the aviation scene in the country and India's airports are littered with rotten carcasses of their stupidity.

It's about time someone gave these arrogant fools a reality check. Airlines should be started only by people who can run them.

You are so right. Now we have 2 more waiting in the wings. Akasa which has grandiose plans and placed a huge order with Boeing and Jet 2.0 still lurking around for a bank guarantee may be.

Spice Jet will die soon, they have disappeared from most routes in India, in fact I dont see even the other airlines much (GoFirst, Air Asia etc...). It is Indigo everywhere.

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