Lessors Set to Grab Kingfisher Planes

Airplane-leasing companies are preparing to repossess planes from India's Kingfisher Airlines Ltd. if the troubled carrier's finances deteriorate further, said an executive at one of the companies.
The executive said that at least two lessors have agents at Kingfisher's offices copying documents relating to their planes. These agents also are monitoring the debt-laden airline's planes to ensure that parts aren't removed in ways that violate lease terms.
Kingfisher spokesman Prakash Mirpuri said in an email that "all leasing companies have the contractual right to access the documents for all their aircraft on an 'as needed' basis."
Every commercial aircraft has reams of records about its use and maintenance. If the information is missing or incomplete, an otherwise usable jetliner could be grounded for safety reasons. Copying documents is a precaution in case the planes are repossessed and it is impossible to recover their accompanying records, aviation officials said.
Kingfisher, which is controlled by Indian business mogul Vijay Mallya, has been hammered by increasing costs, including high interest payments on its nearly $1.3 billion in debt and a 70% jump in fuel prices in the past year. It recently canceled flights on some routes to cut costs and reported a loss of $92.4 million in the quarter ended Sept. 30.
23/11/11 Daniel Michaels and Megha Bahree/Wall Street Journal

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Categories: Foreign Nov 2011, Kingfisher Nov 2011