SpiceJet stock rose 12% on Friday as its CMD Ajay Singh and Busy Bee Airways Private Limited have jointly submitted a bid for crisis-hit GoFirst airline.
The bid has been submitted by Ajay Singh, in his personal capacity, along with Busy Bee Airways Private Limited.
SpiceJet will serve as the operating partner for the new airline by providing staff and services, said the airline in an exchange filing.
SpiceJet added that the collaboration is anticipated to generate synergies between the two carriers, leading to improved cost management, revenue growth, and a strengthened market position within the Indian aviation industry.
"For SpiceJet, serving as the service provider presents significant opportunities for revenue expansion. By leveraging its established infrastructure and operational capabilities, SpiceJet can optimise resource allocation and achieve cost efficiencies across various functions, including maintenance, ground handling, and engineering," said the airline.
At 1510 hours on Friday, SpiceJet's scrip on BSE was trading 12% higher at Rs 71.
SpiceJet said coordinated route planning initiatives would enhance passenger traffic and drive ticket sales for both airlines. By strategically aligning flight schedules and destinations, SpiceJet and the new airline can capture a larger share of the market and cater to diverse passenger needs effectively, it added.
SpiceJet CMD Ajay Singh said GoFirst could be revitalized to work in close synergy with SpiceJet, benefiting both carriers. "Apart from coveted slots at domestic and international airports, international traffic rights, and an order for over 100 Airbus Neo planes, GoFirst is a trusted and valued brand among flyers," he added.
SpiceJet is currently in the midst of a revival plan, having completed the first tranche of capital infusion amounting to Rs 744 crore, with additional subscriptions pending regulatory approval. The company has also initiated the process to raise an additional Rs 1,000 crore. SpiceJet already holds valid shareholder approval to raise up to Rs 2,500 crore through QIP.
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