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Foreign investors to play key role in Ajay Singh's five-year plan for SpiceJet revival

New Delhi: To revive the fortunes of SpiceJet, its original founder Ajay Singh has drawn up a five-year plan and is looking to rope in foreign investors for fund infusion.

Singh, who would be taking over the management control of the cash-strapped carrier after acquiring over 53 percent stake from the current promoters, the Maran family, is awaiting approval for the proposed deal from the civil aviation ministry.

 Foreign investors to play key role in Ajay Singhs five-year plan for SpiceJet revival

Spicejet aircraft. AFP

The original founder has re-boarded SpiceJet amid the carrier facing financial crunch and even curtailing its operations significantly.

"The airline has given a revival and restructuring plan to the civil aviation ministry for change in control, which has to be cleared by it. Once they (the Ministry) do it, we will execute the revival plan," Singh told PTI last night.

On Thursday, the SpiceJet board approved the 'Scheme of Reconstruction and Revival' that would see Kalanithi Maran and Kal Airways transferring ownership along with ceding management and control of the ailing airline to Singh.

According to Singh, the revival plan would focus on strengthening finances and operational efficiency, among others.

He has also drawn up a five-year plan to rejuvenate the low-cost carrier, which may include phasing out of the Bombardier Q400 fleet.

Without disclosing specific details, he said there would be foreign investors for fund infusion.

In response to a query on whether the revival plan also includes some retrenchment as well, Singh said, "Downsizing has to be done... We will try to keep it at minimum."

SpiceJet has around 5,000 employees.

While the company did not disclose the financial details of the deal and revival plan, official sources said that overall the deal size could be worth Rs 1,500 crore in three tranches.

On the operational side, Singh said that with 41-42 planes, at present the operations seem to be normal.

Gradually, the number of flights would be increased according to the fleet size, he added.

The fresh lease of life marks the third change in ownership for the airline, which was founded in 2005 by Singh along with London-based Kansagra family of Indian origin.

US-based investor Wilbur Ross, known as a turnaround specialist, held a substantial stake for a brief period before selling it to Marans in 2010.

PTI

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Updated Date: Jan 16, 2015 15:35:33 IST