US billionaire investor confirms interest in Spicejet

NEW INTEREST: Wilbur Ross specialises in leveraged buyouts and is known for restructuring failed companies in industries.

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New Delhi: US venture capitalist Wilbur Ross has confirmed his interest in acquiring a stake in Spicejet Airlines, which had earlier rejected UB Group’s similar offer.

Sources reveal both the parties are in advanced stage of talks. If the deal is sealed, Spicejet will be issuing fresh equity to Ross, which means that the stakes of other promoters will proportionately reduce.

The main promoters in Spicejet are Ishitmar with 14 per cent, Kansagra family with almost 13 per cent, and Ajay Singh with almost 4 per cent stake.

Wilbur Ross specialises in leveraged buyouts and is known for restructuring failed companies in industries. And Ross’ offer comes at a time when Spicejet is in need of expertise and fund infusion. The domestic airline is incurring a loss of Rs 70 lakh everyday and has payables pending worth Rs 100 crore in the past three months.

Earlier, Vijay Mallya’s UB group too had approached the company, but their offer did not find favour with the promoters. They feared that the company will be forced to change its business model and might have to compromise on the brand as was seen in case of Kingfisher's acquisition of Deccan Aviation earlier.

Meanwhile, all the speculation over equity stake sale has got the stock excited, which closed with gains of over 21 per cent on Monday's trade.