Kingfisher may get funds from SBI-led group to stay afloat
PTI NEW DELHI AS cash-strapped Kingfisher Airlines is battling to stay afloat, a consortium of lenders is believed to be considering fund support to the beleaguered carrier.
A 13-bank consortium, led by State Bank of India, is considering providing short-term funding to the airline but the quantum of support is yet to be decided, sources said.
Each member bank has to get approval from its board and the process would take some time, the sources said.
There was no official word either from the bankers or Kingfisher on the reports that State Bank of India has agreed to give about Rs 1,500 crore.
When contacted, SBI Chairman Pratip Chaudhuri declined to comment on the issue, saying client confidentiality prevents him from talking about a particular company.
Meanwhile, Civil Aviation Minister Ajit Singh said that the recent action taken by the ministry like allowing fuel import and relaxing FDI cap make airline business plan more viable. “So, if the banks can loan them money, it is all good,” Singh said here.
When asked if SBI has given loan to Kingfisher Airlines, Finance Minister Pranab Mukherjee said, “I cannot comment on it now. As and when events take place you will come to know.” At the same time, Central Board of Excise and Customs Chairman S K Goel said, “Kingfisher had an outstanding tax due of Rs 70 crore and he had promised to pay in installments.” The company has paid Rs 10 crore in December, Rs 20 crore in January and they have to pay Rs 20 crore in February, he said.
“Still few more days left in February, they will pay I am sure and in March they will pay the remaining Rs 20 crore. So, they will pay all the arrears by March 31...I hope so,” Goel said.
Singh also said, “We have made it clear and I am sure (Vijay) Mallya knows that Air India is a government concern.
Whatever help we give them (Air India), we cannot do it to any private industry.” Kingfisher Airlines Chairman Vijay Mallya said, “The fact is we have never asked for a bailout (from the government). I would never have thought about that. I know exactly the constraints in this country with private enterprise. So this entire sort of bailout issue which media is making, we have never asked to bail us out.” Kingfisher has suffered a loss of Rs 1,027 crore in 2010- 11 and has a debt of Rs 7,057.08 crore, latest figures show. The company’s net loss widened to Rs 444.26 crore for the quarter ended December 31, 2011, due to high fuel costs and weaker rupee from Rs 253.69 crore in the October-December quarter in the last fiscal.
The Kingfisher Airlines cancelled about 20 flights on Wednesday. Among the flights cancelled this morning were 14 from Mumbai and two from Delhi. Reports said the airlines was partially restoring its operations from Kolkata especially flights from there to the northeast. All operations from Kolkata were shut down from Friday night.