Kingfisher lenders meet to decide future course

Kingfisher lenders meet to decide future course

Airline under lockout since October 1 and subsequent suspension of operations

Kingfisher lenders meet to decide future course

Kingfisher’s bankers, which have over Rs 7,500 crore locked in the ailing airline, will soon meet to chart out the future course of action, said PNB Chairman & Managing Director K R Kamath.

“The bankers will sit and decide what is the situation now and what they will do,” Kamath said here.

Punjab National Bank (PNB) is part of the SBI-led consortium of 17 banks that has exposure in the cash-strapped airline. “The leader (State Bank of India) will convene the meeting,” Kamath said.

Last week, the Directorate General of Civil Aviation (DGCA) suspended licence of beleaguered airline following its failure to come up with a viable plan for financial and operational revival.

The carrier has been saddled with a loss of Rs 8,000 crore and a debt burden of another over Rs 7,524 crore, a large part of which it has not serviced since January. The airline currently has only 10 operational aircraft compared to 66 a year ago.

In November 2010, the banks had restructured Kingfisher loans worth Rs 6,500 crore. The airline is under a lockout since October 1 and subsequent suspension of entire operations. The airline has suffered losses of Rs 1,609 crore in 2008-09, Rs 1,647 crore in 2009-10, Rs 1,027 crore in 2010-11 and Rs 732 crore in 2011-12.

Meanwhile, overseas investors as well as small individuals and HNIs seem to be on a share buying spree in Kingfisher Airlines, even as questions are being raised about resumption of its operations after the cash-strapped carrier’s licence was suspended.

The foreign institutional investors (FII) have more than doubled their holding to 2.46 per cent stake in Vijay Mallya-led UB group’s Kingfisher Airlines, while small individual shareholders hiked their holding significantly to 17.59 per cent during the quarter ended September 30.