Sun Group CFO: Can't Make Large Investments Into SpiceJet

17/12/2014 12:47 PM IST | Updated 15/07/2016 8:24 AM IST
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A SpiceJet Ltd. aircraft prepares to land at Chhatrapati Shivaji International Airport in Mumbai, India, on Monday, Sept. 17, 2012. India’s decision allowing airlines to sell stakes of as much as 49 percent to overseas carriers may be most beneficial to operators least in need of investment. Photographer: Dhiraj Singh/Bloomberg via Getty Images

NEW DELHI: The parent of India's loss-making SpiceJet Ltd cannot make large investments into the carrier and can't do more than provide a guarantee for a bank loan needed to keep the airline from collapsing, said Sun Group chief financial officer S.L. Narayanan.

"We do not have the liquidity to invest large sums at the time which is why we need bank financing. For which the promoters are willing to provide a guarantee," Narayanan told Reuters on Wednesday. "We cannot do more than this."

SpiceJet was forced to ground its entire fleet on Wednesday after oil companies, which are owed money by the airline, refused to refuel its planes.

On Tuesday, the civil aviation ministry said airport operators would be asked to give the airline 15 days to make payments, while state oil companies would be ask to give credit for up to 15 days.

The measures, the ministry said, were aimed at avoiding a collapse which it said would be a "major setback" for the civil aviation sector.

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