Maran has the cash to bail out SpiceJet

Maran family owns 75% stake in publicly listed Sun TV Network, which has a market capitalisation of Rs 13,243 crore (Rs 132.43 billion)

Kalanathi Maran and family, the promoters of the Sun group that runs cash-strapped SpiceJet, have enough cash to finance a bailout of the airline, whose operations remained partly suspended on Wednesday because it was unable to pay cash for aviation turbine fuel to oil companies.

The airline has an immediate overdue of Rs 1,400 crore (Rs 14 billion) to vendors, lessors, airport operators and oil companies, among others, and an overall overdue of around Rs 2,000 crore (Rs 20 billion), according to civil aviation ministry sources.

The Maran family owns a 75 per cent stake in publicly listed Sun TV Network, which has a market capitalisation of Rs 13,243 crore (Rs 132.43 billion).

In simple terms, the value of Maran’s shares in Sun is Rs 9,932 crore (Rs 99.32 billion).

So, he could clear SpiceJet’s entire dues in one go if he sold only part of his shareholding.

In 2013-14, Sun TV had a profit of Rs 717 crore (Rs 7.17 billion) on a revenue of Rs 2,097 crore (Rs 20.97 billion).

By comparison, even as SpiceJet’s revenue was higher, at Rs 6,356 crore (Rs 63.56 billion), the airline was in the red in the year, with a loss of Rs 1,003 crore (Rs 10.03 billion).

Besides, the Marans have a 75 per cent stake in Kal Cables, the distribution arm of the Sun group.

The family also owns a 80 per cent stake in Sun Direct, India’s third-largest direct-to-home operator, with a reach of over nine million homes across the country.

In 2013-14, Sun Direct reported a revenue of Rs 370 crore (Rs 3.7 billion).

The Forbes magazine had adjudged Maran as the 38th richest man in India, with a net worth of $2.3 billion (as of September).

Also, Kalanathi Maran and wife Kavery top the list of best-paid chief executive officers in India. Based on annual reports, the two drew Rs 59.89 crore (Rs 598.9 million) each, including salary, perquisites and other allowances, 2013-14.

For Sun TV, that amounts to a payout of Rs 119.6 crore (Rs 1.19 billion) -- enough for the Marans to not only clear oil firms’ fuel overdues but also what the airline owes airport operators.

Image: Kalanithi Maran, chairman and MD of Sun Group, and promoter of SpiceJet. Photograph: Kind courtesy, Bombardier Aerospace