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SpiceJet Needs To Be Saved: Co-founder Ajay Singh

SpiceJet co-founder Ajay Singh is returning to rescue the struggling carrier he sold nearly four years ago. Mr Singh, who helped found SpiceJet in 2005, has agreed to take control of the ownership and management of the airline from its majority owner Kalanithi Maran.
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SpiceJet co-founder Ajay Singh
SpiceJet co-founder Ajay Singh

SpiceJet co-founder Ajay Singh is returning to rescue the struggling carrier he sold nearly four years ago. Mr Singh, who helped found SpiceJet in 2005, has agreed to take control of the ownership and management of the airline from its majority owner Kalanithi Maran.

Mr Maran and his KAL Airways Private Ltd own nearly 59 per cent of SpiceJet, assuming the full conversion of warrants and securities, according to Bombay Stock Exchange data. SpiceJet, which has been unprofitable since 2013, has been struggling for months, and last month had to briefly ground its flights after suppliers refused to refuel its planes. Mr Singh, credited with coining Prime Minister Narendra Modi's winning campaign slogan, "acche din" (good days), still owns nearly 5 per cent of SpiceJet.

Speaking to NDTV, Mr Singh said SpiceJet's failure would lead to a lot of problems for flyers and could impact the investment climate of the country. "SpiceJet as an airline needs to be saved. SpiceJet's failure will lead to a lot of problems for consumers whose fares will go up. Employees will be without a job, 1.4 lakh investors will be wiped out," he said. (Watch)



If the airline goes down under, the investment climate in the aviation sector as well as the country will be impacted, he added.

SpiceJet, which began life in 2005, employs around 5,000 people and operates 230 flights a day in a market where demand for air travel is rising rapidly but making a profit has proven difficult for most major airlines.

Mr Singh is optimistic that there is room for SpiceJet to grow profitability. "It is great time to get back into SpiceJet. Oil prices are at historic lows. Along with economic growth will come a large increase of people who will like to fly," he said.

The SpiceJet co-founder also said that other investors would be joining him to turn around the airline. But he did not reveal the names of investors due to non-disclosure agreement.

The focus would be to ensure that the airline returns to profit in shorter period of time, he said. Apart from increasing revenues, steps would be taken to lower costs so that unit costs match that of other budget airlines, he added.

(With agency inputs)



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