SpiceJet finalises settlement with ELFC, to resolve liabilities worth $16.7 mn

Spicejet and ELFC reached an amicable settlement for an undisclosed, lower amount than the original claim.

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26 Aug, 2025 12:21

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SpiceJet has successfully resolved its long-standing legal dispute with Engine Lease Finance Corporation (ELFC) in continued efforts to address financial challenges and stabilise operations. ELFC had originally claimed $16.7 million from the airline, but both parties reached an amicable settlement for an undisclosed, lower amount, said Spicejet in a stock exchange filing on September 24.

SpiceJet stock fell about 1.4 percent on Tuesday to Rs 69.3 in morning trading on BSE. Earlier, on Monday, the stock had jumped about 5 percent, following a successful QIP fundraising of Rs 3,000 crore.

The Qualified Institutional Placement (QIP) was significantly oversubscribed by institutional investors and mutual funds. International investors like Societe Generale, Goldman Sachs, and Discovery Global Opportunity participated in the QIP.

Also read | Spicejet raises Rs 3,000 crore via QIP; Goldman, Societe Generale among investors

The airline plans to utilise the funds raised to settle liabilities, expand operations, and enhance its fleet. With the QIP, SpiceJet aims to unground 28 aircraft and revive its fleet, which was reduced to 28 operational aircraft due to financial dues and grounded planes. SpiceJet also plans to leverage its exclusive access to regional and international destinations, boosting its operational capacity.

The settlement comes amid SpiceJet’s wider initiatives to streamline operations for future growth. Ajay Singh, Chairman and Managing Director of SpiceJet, said: “We are pleased to have reached a mutually beneficial settlement with ELFC, which enables us to move forward with a clean slate. This agreement not only resolves past issues but also strengthens our position as we embark on the next phase of growth and expansion.”

Representatives of SpiceJet and ELFC will now formalise the agreement, bringing an end to all litigation between them.

This latest round of fundraising follows years of struggle, exacerbated by rising crude oil prices and global grounding issues with Boeing 737 Max aircraft. While SpiceJet’s total liabilities have amounted to Rs 3,700 crore, the successful QIP is expected to ease some of these financial pressures and set the airline on a path to recovery and growth.

Earlier this month, SpiceJet said that it expects a 'promising growth' as it aims to unground 28 aircraft, doubling its fleet capacity. The airline’s operational fleet has dropped from 74 in 2019 to 28 in 2024 due to grounded planes tied to dues and fund issues. Rising fuel costs have also hit the carrier, with Brent crude nearing $120 per barrel in 2022.

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