SpiceJet initiates fresh funding of $270 mn for Go First acquisition

After much speculation, SpiceJet has confirmed its interest in acquiring bankrupt carrier Go First through a regulatory filing on the exchanges on Monday. The company has also initiated a process of raising fresh capital of around $270 million to "strengthen its financial position and provide resources to invest in growth plans."

Earlier this week, SpiceJet, Sharjah-based Sky One, and Africa-based Safrik Investments had all asked the resolution professional of Go First to extend the deadline to make proposals. The last date for submission of the bids to acquire the airline was November 22. However, as no bids were made, the lenders had started to contemplate liquidation of Go First.

Of the three companies that have shown interest, SpiceJet is considered a serious contender, as neither Sky One nor Safrik have much experience in handling passenger flights.

SpiceJet itself has struggled with a cash crunch, and the board had already approved a proposal to raise Rs 2,250 crore through the issue of shares from 64 entities just last week.

Following the announcement of SpiceJet's interest in the bankrupt airlines, its shares hit a fresh 52-week high at Rs 69.20, as they rallied 8 per cent on the BSE in Tuesday's intra-day trade. In the past two trading sessions, the stock of the airline has jumped 29 per cent, and in the past month, it has surged 82 per cent, as compared to an 8.3 per cent rise in the S&P BSE.

SpiceJet also said it will soon be listing its securities on the National Stock Exchange (NSE). In a regulatory filing, its statement read, "In order to reach a wider investor base, the company shall soon be listing its securities on the National Stock Exchange of India Limited."