Mumbai: The troubled Kingfisher Airlines Ltd has once again turned to business associates of its billionaire promoter Vijay Mallya for capital infusion into India's second largest airline by market share, said sources briefed on the matter.
The airline has recently received Rs 763 crore from certain associates, mostly Mallya's allies from the mainstay liquor business, as unsecured loan. This is besides the Rs 709 crore the company received from them through optionally convertible debentures (OCDs) earlier this year. These business associates are deemed as persons acting in concert (PAC) with the promoter. On Monday, the airline's lenders led by State Bank of India ( SBI) said that they will release fresh funds or restructure loans only after the promoter group showed up with at least Rs 800 crore in capital. The lenders also wanted the airline to come up with a viable business plan to compete in the market.
Kingfisher may be tapping the associates, or co-investors, for further fund requirements, said sources at Mallya's beer to airline conglomerate, UB Group. The airline's parent UB Holdings Ltd is tapping these co-investors who are betting on medium-term upsides when foreign direct investment (FDI) is allowed in the aviation sector.
15/11/11 Reeba Zachariah & Boby Kurian/Times of India
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