SpiceJet, headquartered in New Delhi, announced on Thursday the resolution of a ₹413 crore dispute with aircraft leasing company Echelon Ireland Madison One Ltd. This settlement marks the third dispute resolution announced by the airline within a span of two weeks, amidst the challenges it faces. According to the airline’s statement, this latest settlement is expected to yield savings of USD 48 million (₹398 crore).

Settlement Terms and Acquisitions

As part of the ₹413-crore dispute settlement, SpiceJet will acquire two airframes. An airframe refers to an aircraft without engines. These airframes, both Boeing 737 NG planes, contribute to the airline’s strategy of fleet augmentation amidst its operational difficulties. With this settlement, SpiceJet has now procured a total of three airframes through dispute resolutions.

Total Savings and Previous Settlements

The successful resolutions, including those with Cross Ocean Partners and Celestial Aviation, have resulted in total savings of ₹685 crore for SpiceJet. The settlement with Cross Ocean Partners, announced on March 5, involved approximately USD 11.2 million (₹93 crore) and included the acquisition of an airframe and an engine. The earlier settlement with Celestial Aviation, disclosed on February 28, amounted to USD 29.9 million (₹250 crore).

Market Response

Following the announcement, SpiceJet’s shares surged by 3.52% to reach Rs 64.10 apiece in morning trading on the BSE. This positive market response underscores investor confidence in the airline’s ability to address financial disputes effectively and strategically acquire assets amidst its ongoing challenges.

In summary, SpiceJet’s resolution of the ₹413-crore dispute with Echelon Ireland Madison One exemplifies its commitment to resolving financial challenges and strengthening its fleet. The successive dispute settlements not only result in substantial cost savings for the airline but also signal its proactive approach to mitigating financial risks and enhancing operational resilience.