July 4, 2012
Finance group SREI has bought $72 million of Kingfisher Airlines’ debt, calling it a “good buy”. The airline has never posted a profit and recently shut down all international operations.
A Kingfisher Airline flight awaits clearance to take off from the city airport in Mumbai
July 4, 2012
Finance group SREI has bought $72 million of Kingfisher Airlines’ debt, calling it a “good buy”. The airline has never posted a profit and recently shut down all international operations.
A Kingfisher Airline flight awaits clearance to take off from the city airport in Mumbai
A debt fund managed by India's finance firm SREI Infrastructure Finance has bought $72 million worth of debt of the beleaguered Kingfisher Airlines, its officials said on Monday.
The Kolkota-based SREI Infra Finance group chief financial officer Sanjeev Sancheti told the Press Trust of India it was "a good buy as it is a fully secured debt". The debt was bought from lender ICICI Bank.
Private carrier Kingfisher, controlled by liquor baron Vijay Mallya, reported a net loss of 11.52 billion rupees ($208 million) in the three months to March, a tripling of losses, and has a total debt of at least $1.4 billion.
The airline has never posted a profit since its launch in 2005 and scaled down its operations in recent months, including shutting down overseas operations.
Kingfisher desperately needs at least $600 million to stay in business and pay the amount it owes to suppliers, lenders, other creditors and staff.
It now has the smallest market share among Indian airlines, at 5.2 percent.
Mallya has been unable to find strategic investors who are willing to pump money into the airline. He also hopes that the government may soon clear a stalled proposal, which would allow foreign carriers to invest in domestic airlines.
Courtesy: nydaily
