Embattled Kingfisher Airlines on Thursday won more time from lenders to develop a turnaround plan while its bankers moved ahead with the sale of two properties to recover a small fraction of what they are owed. Kingfisher, controlled by liquor baron Vijay Mallya, has never made a profit in a struggling Indian airline industry and has seen its domestic market share fall from second to last among the six big carriers after grounding most of its fleet.
"They will have to come up with concrete steps to improve operations in 15 days, otherwise we will have to take some other actions," said an executive with State Bank of India, which heads a consortium that met the airline on Thursday. The banker declined to be named or give specifics.
Kingfisher, named after Mallya's flagship beer brand, had debt of $1.4 billion at the end of March, and most of its banks, which are mostly state-run, declared its loans to be in default during the December quarter. ICICI Bank this week said it unloaded its Kingfisher debt to a fund managed by SREI Infrastructure Finance. Earlier this week lenders to the carrier, worried it will fall short in its efforts to find a big investor, told Reuters they were considering ways to recover their money including invoking securities and guarantees against their loans.
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