Kingfisher Airlines may get funds from banks

A 13-bank consortium, led by SBI, is considering to provide short-term funding to the airline

PTI | February 22, 2012



As cash-strapped Kingfisher Airlines is battling to stay afloat, a consortium of lenders is believed to be considering fund support to the beleaguered carrier.

A 13-bank consortium, led by State Bank of India, is considering providing short-term funding to the airline but the quantum of support is yet to be decided, sources said.

Each member bank has to get approval from its board and the process would take some time, the sources said.

There was no official word either from the bankers or Kingfisher on the reports that State Bank of India has agreed to give about Rs 1,500 crore. When contacted, SBI Chairman Pratip Chaudhuri declined to comment on the issue, saying client confidentiality prevents him from talking about a particular company.

Meanwhile, Civil Aviation Minister Ajit Singh said that the recent action taken by the ministry like allowing fuel import and relaxing FDI cap make airline business plan more viable.

"So, if the banks can loan them money, it is all good," Singh said here.

When asked if SBI has given loan to the beleaguered Kingfisher Airlines, Finance Minister Pranab Mukherjee said, "I cannot comment on it now. As as when events take place you will come to know."

At the same time, Central Board of Excise and Customs Chairman S K Goel said, "Kingfisher had an outstanding tax due of Rs 70 crore and he had promised to pay in installments."

The company has paid Rs 10 crore in December, Rs 20 crore in January and they have to pay Rs 20 crore in February, he said.

"Still few more days left in February, they will pay I am sure and in March they will pay the remaining Rs 20 crore. So, they will pay all the arrears by March 31...I hope so," Goel said.

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