Kingfisher must find more backing by Nov 30 - lenders

MUMBAI Tue Nov 6, 2012 11:07pm IST

A passenger walks with her luggage in front of a Kingfisher Airlines reservation office at the domestic airport in Mumbai October 23, 2012. REUTERS/Danish Siddiqui

A passenger walks with her luggage in front of a Kingfisher Airlines reservation office at the domestic airport in Mumbai October 23, 2012.

Credit: Reuters/Danish Siddiqui

Stocks

   

MUMBAI (Reuters) - Kingfisher Airlines (KING.NS) creditors have asked it to bring in fresh equity or an investor by November 30, the chairman of State Bank of India told Reuters.

Kingfisher may not be able to fly if it does not infuse enough capital, hurting its ability to get investors, Pratip Chaudhuri said on Tuesday. He did not say what steps the lenders would take if it was not able to infuse capital by the deadline.

State Bank of India is the leader of a 17-bank consortium, which has lent about $1.4 billion to the debt-ridden carrier.

On Monday, a source told Reuters Kingfisher's licence to fly will not be renewed if the carrier fails to provide a turnaround plan by end-December.

Kingfisher, once India's second-largest airline, has not flown since the start of October after a protest by employees, unpaid since March, turned violent.

"Kingfisher must bring in investor or equity by November 30. We have given them enough time," Chaudhuri said on Tuesday. "It can't go on like this. (The) Kingfisher loan has been non-performing on our books for over a year."

Lenders will meet company senior executives next week to discuss a turnaround plan, S. Vishvanathan, managing director of the State Bank of India, separately told Reuters.

The Directorate General of Civil Aviation (DGCA), suspended its licence last month after Kingfisher, controlled by liquor baron Vijay Mallya, failed to address its concerns over safety.

It has since managed to convince striking staff to come back to work, but it still needs to come up with a revival plan that satisfies the regulator to fly again.

(Reporting by Swati Pandey; editing by Patrick Graham)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Earnings Season

Earnings Season

Reliance Q4 sales rise, refining margin narrows.  Read 

Innovative Solution

Innovative Solution

Turning smog into jewels - a Dutch designer's solution to Beijing's pollution.  Video 

Insider Trading

Insider Trading

Rajaratnam's brother loses bid to dismiss insider trading charges.  Full Article 

Literary Giant Dies

Literary Giant Dies

Mourning and memories in Gabriel Garcia Marquez's languid hometown.  Full Article 

S&P on India

S&P on India

S&P: India's ratings to depend on next govt econ, fiscal policies.  Full Article 

Ambitious Aim

Ambitious Aim

In green car race, Toyota adds muscle with fuel-cell launch.  Full Article 

Bond Market

Bond Market

A star abroad, RBI boss riles bond traders at home  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage