Kingfisher in talks for more bank funding

Bangalore: Kingfisher Airlines has approached a consortium of banks for funds to bail out the airline even as it has drawn about 80 per cent of the Rs 1,000-crore loan it received from ICICI Bank early this year.
A top official with the UB Group, which owns the airline, told Business Line that it has informed the consortium that it will require funding till March 2010. He did not specify the amount of loan it has sought from the consortium.
The airline increased its borrowing limit recently to Rs 7,500 crore. It had earlier indicated that it wants to raise about $400 million. But under the current circumstances, the airline may need to borrow more now. “It (funds) should definitely help the airline to cross over the hump,” the official said.
Sources in the airline say that the airline’s management expects some positive response from its recent lobbying with the government over lifting the ban on allowing foreign airlines to buy stake in domestic airlines.
Sources pointed out that with the Government allowing 100 per cent foreign direct investment in setting up airports, it should allow domestic airlines too to source funds from foreign airlines. With most countries adopting an ‘open sky’ policy as well, there has been a significant change in the flight pattern as well as the concept of bilaterals.
22/12/08 K Giriprakash/Business Line

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Categories: Kingfisher Dec 2008