The exclusivity clause for closing the deal between private equity investor WL Ross and SpiceJet that ended on July 31 has been extended because the US-based company is re-negotiating with creditors to write down their debt with the low-cost carrier.
WL Ross had signed an agreement to invest $80 million as equity in the cash-strapped Delhi-based airline three weeks ago. Sources close to the deal said no due diligence issues were involved but commercial issues are delaying the closure of the deal
Ranjit Nabha, India representative for WL Ross, could not be contacted and did not reply to SMS messages. A senior executive in SpiceJet, however, confirmed that the exclusivity period originally two weeks has been extended to an unspecified date but said the talks were on course and the deal would be signed soon. He also confirmed that WL Ross was re-negotiating terms with SpiceJet creditors.
SpiceJet, which has an over 10 per cent market share, has been looking for an equity infusion to expand its fleet and stay afloat. Earlier negotiations with Vijay Mallya's Kingfisher Airlines failed. Ross is known for its expertise in picking up financially-strapped companies and turning them around.