DGCA de-registers two aircraft of SpiceJet on lessor request

Two Boeing 737s aircraft leased to SpiceJet were deregistered by the Directorate General of Civil Aviation (DGCA) on Thursday under the provisions of Irrevocable De-registration and Export Request Authorisations (IDERA).

Senior official from regulator confirmed and said, "Under the provisions of Irrevocable De-registration and Export Request Authorisations (IDERA) it has happened."

The aircraft were deregistered on the request of two Dublin-based lessors, Wilmington Trust SP Services and Aircastle (Ireland), as per a report on TOI.

A SpiceJet spokesperson said the deregistration of the jets "will not impact" the operations of the carrier.

"This won't impact our ops. One aircraft was grounded for a long period&was to be returned. The other one being returned due to engine issues. Both aircraft being returned consensually,"

The invocation of IDERA is a unilateral action by an aircraft lessor to deregister and repossess its aircraft from the lessee (in this case SpiceJet) in the case of defaults on payment of lease rentals.

As per rules, the DGCA must now deregister the plane within five working days.

This is not the first time that IDERAs have been invoked against the carrier. Last year, two overseas-based lessor - Alterna Aircraft VB and AWAS, a subsidiary of aircraft leasing giant Dubai Aerospace Enterprise (DAE) - had appealed to India's aviation regulator to deregister one SpiceJet aircraft each on alleged payment defaults by the airline.

The airline then said this was part of a plan to send back old planes as it gets new ones.

Last month, the no-frills carrier said it has restructured over USD 100 million outstanding dues to aircraft leasing firm Carlyle Aviation Partners, into equity shares and compulsorily convertible debentures (CCDs). The Board of Directors of SpiceJet Ltd on February 27 approved issuing fresh equity shares of USD 29.5 million (Rs 244.28 crore) to Carlyle Aviation Partners at Rs 48 per share or the SEBI determined price, whichever is higher, the company had said.

Following this transaction, Carlyle Aviation Partners would have over 7.5 per cent equity stake in SpiceJet Ltd. Moreover, the transaction would retire over USD 100 million debt of SpiceJet, thereby strengthening its balance sheet for future expansion.