SpiceJet’s stock price increased by more than 20% on Friday as news broke that Rakesh Gangwal, the co-founder of aviation giant Indigo, is in advanced talks to buy a significant interest in the business.
On October 13, at 3:15 IST, SpiceJet shares increased by almost 20% to Rs 43.82 per share on the BSE. However, the stock increased 19.39% from the starting share price to settle at Rs. 43.60.
The Sun Group chairman Kalanithi Maran case hearing at the Delhi High Court also had an impact on the stock. The central issue in this case is an arbitral decision in Maran’s favor.
In February 2015, Mr. Singh received a 58.46% share in SpiceJet from Maran and his investment firm, KAL Airways, together with the roughly Rs 1,500 crore in liabilities that belonged to the airline. Maran and KAL Airways claimed to have paid SpiceJet Rs 679 crore in accordance with their agreement for the issuing of warrants and preferred shares. Maran filed an arbitration case against SpiceJet and Singh, claiming that the warrants and preferred shares were not distributed in accordance with the contract.
An arbitration tribunal rejected Maran’s claim for damages of Rs 1,323 crore in July 2018 since warrants were not issued to him or KAL Airways. Instead, they gave him a refund of Rs 579 crore plus interest that had already accumulated. SpiceJet was given permission to deposit the remaining Rs 250 crore in cash and to furnish a bank guarantee for Rs 329 crore.
SpiceJet reported the successful payout of Rs 100 crore to KAL Airways, the erstwhile promoter, in September. The airline said that on September 11, a payment of Rs 77.5 crore was paid, and the remaining Rs 22.5 crore was settled on September 12.