ADVERTISEMENT
Lenders to recall Kingfisher loans: Top 10 developments
13 Feb 2013, 02:29 PM IST 
- "We have decided to recall (initiating the recovery process) the loans given to Kingfisher Airlines. However, each bank's board will decide the future course of action," Shyamal Acharya, deputy managing director (mid-corporates) of State Bank of India, which is lead bank in the lenders' consortium, told reporters after a two-hour meeting of bankers with company representatives.
- Ravi Nedungadi, president and chief financial officer of United Breweries, the promoter of Kingfisher Airlines, said the company will wait for "official communication with the lenders' consortium before offering any comment".
- The decision comes even as Kingfisher chairman Vijay Mallya has assured the airline's employees that it will clear salary dues of 11 months, and has also said it plans to restart operations in the forthcoming summer schedule.
- Aviation Minister Ajit Singh today said that while he is concerned that no viable plan has been submitted by the airline to the Directorate General of Civil Aviation yet, the matter is between Kingfisher and the lenders, since it owes them money. The government has already made it clear several times in the past that the airline would not be allowed to operate unless it clears all its dues, including pending salaries and payments to airport operators.
- In a revival plan submitted to the DGCA in December 2012, Kingfisher had said it would require about Rs. 652 crore over the next 12 months for running operations. These funds were to come from United Breweries' resources as the banks were unwilling to further fund the cash-strapped airline. Of the Rs. 652 crore, Rs. 120 crore was needed to meet salary arrears.
- The lenders were hopeful that some money would flow into the airline after Mr Mallya sealed a Rs. 11,100 crore deal with UK's Diageo by selling a majority stake in his liquor company, United Spirits. However, Mr Mallya had said the Kingfisher situation would be dealt with separately.
- The bankers were also banking on some equity infusion into the airline by a foreign player after the government allowed foreign airlines to invest up to a 49 per cent stake in Indian peers last year, but the airline has not been able to find an investor so far.
- Kingfisher has two years from now to get its license renewed, but it has to convince banks, airports, tax authorities and its staff about its viability, sources told NDTV Profit. The airline, which has not flown since October, owes money to all of them.
- For the third quarter ended December 2012, the airline reported a net loss of Rs. 755.17 crore, a period in which it did not operate a single flight.
- Besides five bankers led by SBI, Tuesday's meeting was also attended by the airline's management, including CEO Sanjay Agarwal and Mr Nedungadi.
With inputs from PTI