SpiceJet's sh'holders to decide on Tatas' proposals on Jan 11

New Delhi, Dec 12 (UNI) SpiceJet board has recommended investment proposals worth 118 million dollars, including 17.2 million dollars from Tata Group, to its shareholders who will take a decision on preferential issue of 80-million-dollar equity on January 11, 2007.

The Tatas' offer consists a proposal to invest 1.2 million dollars by Tata Investments Corporation Ltd and 16 million dollars from Ewart Investments Ltd (an investment company of the Tata Group). The combined proposal accounts for 7.5 per cent of SpiceJet's 180 million shares outstanding, SpiceJet Director Ajay Singh told reporters here today.

Other companies which had submitted investment proposals with the flier are US-based Texas Pacific Group (30 million dollars) for 11 per cent of shares outstanding, Dubai's Istithmar PJSC (25 million dollars) for nine per cent, Goldman Sachs (five million dollars) for two per cent.

Istithmar PJSC, at present, owns 2.5-3 per cent of SpiceJet and Goldman Sachs has participation in the company through bond holdings.

Swiss Finance Corporation (10 million dollars) and BNP Paribas (15 million dollars) had also submitted proposals to SpiceJet.

The proposals were approved by the board yesterday and were recommended to the shareholders. ''The proposals were accepted at Rs 51.40 per share. The equity shares will be issued within 15 days after the meeting of shareholders on January 11, 2007.'' SpiceJet Chief Executive Officer Siddhanta Sharma said.

''The money raised through the issue (80 million dollars) will be used for the expansion of aircraft fleet in the next two years,'' Mr Singh said. The airline has planned addition of 7-8 Boeings over the next fiscal and another 10 in calender year 2008, he added.

In response to a question on the nature of Tatas' proposal, Mr Singh said, ''It's financial in nature. The group was interested in the aviation sector, as everyone knows, and that is why they chose to invest in SpiceJet.'' ''The company will request them (Tatas') to participate in the management. We would like to be helped by them and are hopeful they will also be interested in helping us from a financial perspective,'' Mr Singh added.

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