SpiceJet completes payment of $1.5 mn to Credit Suisse; share rises 4%

Snapping its two-session losing streak, shares of SpiceJet surged over 4% on Friday after the budget carrier said that it has transferred $1.5 million to global investment bank and financial services firm Credit Suisse as per the directive issued by the Supreme Court of India. The stock tumbled over 5% in the last two sessions after the apex court issued a stern warning to SpiceJet chairman and managing director (CMD), Ajay Singh, for defaulting on payments owed to Credit Suisse AG.

“SpiceJet Ltd. has complied with the directive of the Supreme Court by remitting $1.5 million to Credit Suisse. The payment was executed on Thursday, September 14^th,” the carrier says in a BSE filing today.

Following the announcement, SpiceJet shares opened higher at ₹39.84 against the previous closing price of ₹38.38 on the BSE. During the session, the aviation stock gained as much as 4% to ₹40, while the market capitalisation increased to ₹2,366 crore.

Earlier this week, the Supreme Court had warned the low-cost carrier of ‘drastic action’ if it failed to pay $1.5 million to Credit Suisse, a Swiss bank, by September 15. A bench of Justices Vikram Nath and Ahsanuddin Amanullah observed: “We have to move to the next drastic step. We are not worried if you shut down. Enough of this dilly-dally business… you will have to abide by the consent terms…this is too much.”

In April 2023, Credit Suisse initiated contempt of court against SpiceJet and its CEO Ajay Singh in the Supreme Court after its failure to comply with a court-approved settlement plan for the payment of dues.

Since 2015, both parties have been engaged in a legal dispute over alleged unpaid dues of $24 million. In 2021, the Madras High Court ordered the airline’s winding up, which was later restrained by the Supreme Court. In August 2022, both parties notified the apex court that they had agreed to settle the dispute.

However, in April, Credit Suisse moved the apex court after SpiceJet failed to pay dues as per the settlement reached between them.

Earlier this month, SpiceJet informed exchanges that it had made repayment of dues to the airline's former promoter Kalanithi Maran’s Kal Airways Private Ltd and international bank Credit Suisse. SpiceJet said it made a payment of ₹77.5 crore to Kalanithi Maran and will complete the payment of ₹100 crore by paying an additional amount of ₹22.5 crore on September 12, 2023, as per the directions of the Delhi High Court.

The airline had also said that it would make the payment of $1.5 million to Credit Suisse by September 15. SpiceJet has already paid a total of $8 million to the Swiss bank.

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