SpiceJet shares climb 4% on inking pact with Export Development Canada to settle liabilities

New Delhi: Shares of SpiceJet on Tuesday jumped 4 per cent after the company said it has signed a pact with Export Development Canada (EDC) to settle liabilities worth USD 90.8 million (around Rs 755 crore).

The stock climbed 3.93 per cent to settle at Rs 61.06 apiece on the BSE. During the day, it jumped 7.23 per cent to Rs 63.

In terms of volume, 93.12 lakh shares of the company were traded on the BSE during the day.

The liabilities stem from a loan acquired by the airline in 2011 for the procurement of 15 aircraft.

The terms of the settlement pact will allow the airline to clear major liabilities, leading to a comprehensive revitalisation of the airline's balance sheet, SpiceJet said in a statement on Tuesday.

Under the agreement, SpiceJet will acquire full ownership of 13 EDC-financed Q400 aircraft, bolstering the airline's operational capabilities and fleet management, it said.

SpiceJet will pay a comprehensive settlement amount to resolve outstanding liabilities amounting to close to USD 91 million, the airline said.

This settlement will lead to savings worth USD 68.3 million (Rs 567 crore) for SpiceJet, it said.

"We have reached this settlement agreement with EDC. This significant milestone will allow us to strengthen our balance sheet," Ajay Singh, Chairman and Managing Director of SpiceJet, said.