Kingfisher gets a Rs 200 cr lifeline

Mumbai: Cash-strapped Kingfisher Airlines, which has been desperately trying to raise funds, has got Rs 200 crore from Uco Bank, said a person familiar with the situation.
The source said the loan was sanctioned on December 30, almost two months after the airline approached the bank for the money.
“The airline (Kingfisher Airlines) has finally been able to raise Rs 200 crore from Uco Bank in December. They had approached other banks too,” he said.
The terms on collateral and interest rate are not known.
“We don’t comment on commercial transactions,” H K Goyal, chairman of Uco Bank said when contacted by DNA.
Kingfisher spokesperson Prakash Mirpuri refused to confirm or deny the fundraising.
“It is not Kingfisher’s policy to discuss such commercial dealings externally,” he said.
A source close to the airline said the money raised would partly be used to meet working capital need and pay off debts, while a portion of it would be kept aside as cash reserve for future needs of the airline.
Last year, the Vijay Mallya-owned carrier had borrowed Rs 500 crore from the State Bank of India (SBI).
The airline is also currently in talks with private equity funds to raise $400 million. Its rival Jet Airways recently got a nod from government for infusion of foreign direct investment (FDI) of $400 million through a QIP.
08/01/10 Ramiya Bhas/Daily News & Analysis

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Categories: Kingfisher Jan 2010