Telecom scam probe hits SpiceJet's funding plans

Budget carrier SpiceJet, which planned to raise around $250 million through a share sale and export credit for aircraft purchases, is in a strange situation now.

While shares of SpiceJet have suffered in the wake of allegations of involvement of Dayanidhi Maran, brother of SpiceJet promoter Kalanidhi Maran, in the 2G spectrum allocation scam, credit also does not seem to come easily.

Neil Mills, chief executive of SpiceJet, says raising funds for aircraft purchases has now become a big challenge for the airline after media reports that linked the firm's majority owner Kalanithi Maran to the 2G spectrum scam.

SpiceJet shares plunged 16 per cent on Thursday after the Central Bureau of Investigation started preliminary investigations against Dayanidhi Maran, who as telecom minister from 2004 to 2007, had allegedly favoured Maxis after it invested in telecom firm Aircel.

SpiceJet had announced plans to raise $200-250 million through share sale and export credit in the current financial year to fund aircraft purchases.

The problem for SpiceJet is that Kalanithi Maran, who owns 38.7 -per cent stake in SpiceJet, is the elder brother of textile minister Dayanidhi Maran, woo is also named in the lawsuit related to the 2G spectrum allocation scam.