Economy

Kingfisher needs Rs 3,000 crore to stay afloat: Bank official

Anjana Chandramouly Bangalore | Updated on March 12, 2018 Published on May 10, 2012

Cash-strapped Kingfisher Airlines' current funding requirement stands at Rs 3,000 crore, a bank official of the lending consortium told Business Line.

The funding requirement is a combination of both equity and bank debt, said the official, adding that there are “three parties keen to invest in the airline once the FDI policy comes through”. Two of them are foreign airlines and one is a pure investor, the official said.

At a meeting with the lending consortium in Bangalore on Thursday, the airline officials also “hinted at corporate debt restructuring for the airline”, whose account has turned a non-performing asset for all the banks. The banks currently have an overall outstanding of Rs 6,460 crore, the official said.

“CDR reference can happen only with a viable business plan, which the company has promised to come up within two weeks. The company will work with SBI Capital to work out a viable business plan,” he added.

Recapitalisation

However, recapitalisation will be a pre-condition for any further lending, he pointed out. Any further lending will take place only with collaterals, “as there is a security gap now”, said the official.

According to the official, the airline has so far invested Rs 1,700 crore from group companies, which was being done on a day-to-day basis to help keep the troubled airline afloat.

The banker also said that the airline was hopeful of reinstating its membership on the IATA billing and settlement plan (BSP) platform, which will give it the opportunity to restart its international flights. IATA had suspended Kingfisher Airlines from the BSP platform in March this year, because of which the airline had to stop its international operations.

> anju@thehindu.co.in

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Published on May 10, 2012
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