Logistics firm files bankruptcy petition against SpiceJet in creditor settlement

New Delhi: The Indian unit of South Korea’s Eusu Logistics has filed a bankruptcy petition with the National Company Law Tribunal (NCLT) against budget airline SpiceJet.

Eusu Logistics India Pvt. Ltd. files complaint over unpaid freight services $1.94 million. Due to the absence of Eusu Logistics’ attorney, the arbitral tribunal did not issue notice and adjourned the hearing. Until November 26th.

On Thursday, aircraft lessor Falgu Aviation Leasing Ltd filed a defense claim against SpiceJet, accusing it of being owed $8.1 million ( $68 Crores). NCLT has issued a notice to SpiceJet in this case.

The list of insolvency actions against SpiceJet for non-payment of dues to various suppliers and aircraft lessors is growing by the day. To date, none of these cases have resulted in the airline entering bankruptcy proceedings.

Creditors previously suing arline include Wilmington Trust SP Services (Dublin), Willis Lease Finance, Celestial Aviation, Aircastle and Alterna Aircraft, as well as AWAS 36698 Ireland, AWAS 36694 Ireland, AWAS 36695, Shannon Engine Support Limited, Aviator ML 29641 Ltd. , Engine Lease Finance BV, Raymach Technologies Pvt. Ltd. and software solutions provider Techjockey Infotech Pvt. Ltd.

Settlement dues

During proceedings on Friday, SpiceJet informed NCLT that it had settled its $4.5 million dispute with Shannon Engine Support Ltd for $2 million.

This settlement follows three other major financial agreements reached by SpiceJet in recent weeks:

• On October 15, the airline settled a $23.39 million dispute with Aircastle (Ireland) Designated Events Company and Wilmington Trust SP Services (Dublin) Ltd. for $5 million.
• On October 9, SpiceJet also settled its dispute with lessors Horizon Aviation 1 Ltd., Horizon II Aviation 3 Ltd. and Horizon III Aviation 2 Ltd. (managed by Babcock & Brown) for $22.5 million. Aircraft Management) in a $131.85 million dispute.
• On September 24, SpiceJet settled the claim with Engine Lease Finance Corp., but the amount was reduced from the original $16.7 million.

SpiceJet expected to receive $736 crore from the last round of funding, which is likely to support its financial stability and help meet its creditor obligations, especially the aircraft lessor which is involved in various legal disputes with NCLT, Delhi High Court and Supreme Court. A recent court order requiring the grounding of leased engines and aircraft without payment of dues has further posed a challenge to the airline.

CMD Ajay Singh said there are plans to expand the fleet size to 100 aircraft by 2026. The airline aims to have its 36 grounded aircraft back in service by March 2025, with the fleet expected to reach 40 aircraft, comparable to Akasa Air, with 40 more to be added later.