Vijay Mallya calls on SBI for Rs 400 crore loan

Mumbai: Kingfisher, the troubled airline owned by Vijay Mallya, fought battles on multiple fronts on Friday. Chairman Mallya, who used to be compared with flamboyant British entrepreneur Richard Branson, met the chairman of India's largest bank to ask for a short-term loan of Rs 400 crore to meet day-to-day expenses, even as leasing companies threatened to repossess 16 aircraft for delay in payment of rentals.
Mallya met Pratip Chaudhuri, chairman of State Bank of India, and top officials of other banks at the SBI headquarters in South Mumbai. Besides the working capital loan, which will be used to meet daily expenses such as salary payments, the chairman asked for letters of credit and guarantees, which would increase the exposure of the banks by Rs 445 crore, to enable the airline to buy fuel, according to people familiar with the matter.
Mallya said his total debt requirement was Rs 2,200 crore. People cognisant of the negotiations said SBI Caps, the merchant banking arm of State Bank of India, will recommend measures that need to be taken to make the airline viable.
19/11/11 Manisha Singhal/Economic Times

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Categories: Kingfisher Nov 2011