SpiceJet spurts as Marans to transfer stake to Ajay Singh

SpiceJet hit an upper circuit limit of 10% at Rs 20.50 at 10:07 IST on BSE after Kalanithi Maran decided to transfer the ownership and management control of the airline to former promoter Ajay Singh.

Meanwhile, the BSE Sensex was down 7.47 points, or 0.03%, to 28,068.08.

On BSE, so far 29.77 lakh shares were traded in the counter, compared with an average volume of 1.13 crore shares in the past one quarter.

The stock opened with an upward gap of 10% at Rs 20.50 and remained stuck at that level so far.

The stock hit a 52-week high of Rs 22.20 on 26 May 2014. The stock hit a 52-week low of Rs 11.10 on 13 August 2014.

The stock had outperformed the market over the past one month till 15 January 2015, rising 37.64% compared with 2.77% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 22.78% as against Sensex's 6.55% rise.

The small-cap company has an equity capital of Rs 599.45 crore. Face value per share is Rs 10.

SpiceJet after market hours yesterday, 15 January 2015, announced that its board of directors at a meeting held yesterday, 15 January 2015, inter-alia, taken on record the proposal of the principal shareholder and promoter, Kalanithi Maran and KAL Airways to transfer the ownership, management and control of the company to Ajay Singh pursuant to a scheme of reconstruction and revival for the takeover of ownership, management and control of the company to be filed before the Ministry of Civil Aviation, Government of India. The board has further directed the company to take further steps to implement and undertake all necessary steps in this regard.

According to reports, Singh plans to infuse Rs 1500 crore into SpiceJet in three tranches as a part of revival plan. The first tranche of Rs 500 crore is expected by 25 January 2015, with two more tranches of equal amounts by March this year. The new investors, which reportedly include JP Morgan, are also expected to seek exemption from an open offer from the Securities and Exchange Board of India (Sebi), reports added.

As on 30 September 2014, Marans held 53.48% stake in SpiceJet while major 'public' shareholders include Tata group firm Ewart Investments (1.79%) and Kalpana Singh (1.41%). Retail investors held 45.69% in the company.

SpiceJet is facing tough business conditions and the situation has only worsened in recent days with disruption of flights. The cash crunch reportedly forced the airline to delay salaries to employees in December 2014.

SpiceJet reported a net loss of Rs 310.45 crore in Q2 September 2014, lower than net loss of Rs 559.49 crore in Q2 September 2013. Net sales rose 15.2% to Rs 1435.86 crore in Q2 September 2014 over Q2 September 2013.

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