SpiceJet claims ‘big breakthrough in financial restructuring’ with EDC settlement

NEW DELHI: SpiceJet on Tuesday claimed to have achieved “the biggest breakthrough” in its ongoing monetary restructuring efforts by reaches “a settlement with Export Development Canada (EDC) to resolve $91 million (Rs 755 crore) liabilities.” This, the airline says, will led to financial savings of $68.3 million (Rs 567 crore) for and permit it to amass full possession of 13 EDC-financed Q400 plane. The settlement with EDC “liberates SpiceJet from the obligation of regular monthly rentals for these aircraft. With 12 of these Q400s currently grounded, their refurbishment and subsequent return to service will enable SpiceJet to promptly launch flights on numerous (most profitable) regional and UDAN routes,” the airline stated.As a part of the EDC settlement, SpiceJet can pay “a comprehensive settlement amount to resolve outstanding liabilities amounting to close to $91 million as per SpiceJet books of accounts. This alleviates SpiceJet of a substantial financial burden… lays the groundwork for a (better) balance sheet.”SpiceJet CMD Ajay Singh stated: “We are pleased to have reached this settlement agreement with EDC and we thank their leadership and management team for their cooperation, understanding and progressive approach through the process. This significant milestone will allow us to strengthen our balance sheet and position the airline for long-term success.” The EDC liabilities stem from a mortgage taken by the airline in 2011 for procuring 15 plane.

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