New Delhi/Mumbai: After waiting for almost a year, lenders led by State Bank of India on Tuesday decided to recall loans given to Vijay Mallya's Kingfisher Airlines and encash shares that are pledged with banks as collateral.
Subsequently, if loans adding up to Rs 7,500 crore and overdue of over Rs 1,000 crore are not repaid by the flamboyant businessman, who often drew comparisons with Virgin's Richard Branson, lenders will encash other securities, including Mallya's personal guarantee and property. Already, banks are in the process of selling his villa in Goa to recover part of the dues.
Lenders will set up a sub-group that will look at the legal aspects of selling the shares, said a banker. A loan recall is an extreme step when banks are convinced that there is nothing that the promoter can do to revive a sick company. In Mallya's case, the wait has been longer. With no end in sight, 17 banks that have exposure to the airline, once the symbol of luxury in the skies, finally decided to take the call at a meeting on Tuesday.
13/02/13 Times of India
