Saturday, August 27, 2016

Vijay Mallya elusive for half-a-year now, no recovery from Kingfisher: A quiet defeat for govt?

Six months after liquor baron Vijay Mallya, whose grounded Kingfisher Airline owes Rs 9,000 crore to 17 banks, left the country to the UK, the case hasn’t made any serious progress yet. This is despite several attempts by the bank consortium, the government and investigative agencies to nail Mallya to get him to repay the money and courts issuing warnings against Mallya. The case is pretty much at the point where it all started in 2012 when banks classified Kingfisher loan as a non-performing asset (NPA) and cried foul on Mallya’s financial conduct. Mallya has so far denied any wrongdoing.
On Thursday, banks yet again failed to find any takers for an auction that put Kingfisher brand logo (valued Rs 4,000 crore by consultancy Grant Thornton once),  and its once-famous tag-line 'Fly the Good Times' on the block besides some immovable assets of the grounded bird. The auction itself seemed like a desperate attempt with banks putting even some of the movable assets worth a mere Rs 13.70 lakh lying at the Kingfisher House up for auction including eight cars — Toyota Innova and Corolla, and Honda City and Civic among others, the reserve price of each car ranging from Rs 90,000 to Rs 2.50 lakh.
Remember, this is the second failed attempt to auction Kingfisher assets by banks. Early this month, banks had failed to get any bidders for the 17,000 square feet Kingfisher House in Mumbai. The reason for the failure isn’t hard to imagine—no one wants to try their luck in a case that is in a major mess and also considering the erosion in their value, leaving banks helpless in recovery.
26/08/16 Dinesh Unnikrishnan/First Post
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