Beleaguered budget carrier SpiceJet will submit a revival plan to the government on Friday on the basis of a proposed investment of $200 million from founding promoter Ajay Singh and US-based JP Morgan Chase, official sources said.

“Based on this proposed investment, SpiceJet will submit a revival plan to the Civil Aviation Ministry tomorrow,” a source said.

The funds could flow into the cash strapped airline in about a month’s time.

This was indicated to the Ministry of Civil Aviation at a meeting that Ajay Singh had with senior Ministry officials in the last few days. Singh, a former promoter of SpiceJet who later exited the airline, is now busy putting together a team of international investors to bail out SpiceJet. The new investors plan to buyout the entire over 50 per cent stake that the Marans have in SpiceJet, sources said. The airline is currently controlled by billionaire Kalanithi Maran’s Sun Group.

At another meeting with senior Ministry officials earlier this week, the airline’s officials said that they had come out of an extreme crisis. The investors had already pumped in ₹17 crore in the airline which has helped wipe out dues owed to oil companies.

Good prospects

Asked why an investor will look at investing in an airline which had debts of ₹1,600 crore on December 5, sources said that there was a lot of investor interest in SpiceJet and that the aviation sector is still a good investment prospect. “The Government has taken several steps which will help the domestic aviation sector… like allowing foreign airlines to pick up a stake in domestic airlines. We are also requesting the Finance Ministry to allow domestic airlines to use the external commercial borrowing window to raise funds at a lower rate of interest abroad. We are also asking for infrastructure status to the industry so that domestic banks can lend funds to domestic airlines at lower rates than what is levied at the moment’’ sources said.

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