13 lenders take 23.37% in Kingfisher Airlines

A consortium of 13 lenders to Kingfisher Airlines has taken a 23.37 per cent stake in the airline as part of a debt restructuring deal. The consortium includes State Bank of India, ICICI Bank, IDBI Bank, Bank of Baroda and Punjab National Bank.

The airline allotted 116 million shares to the consortium members at a conversion rate of Rs 64.48 per share to cover a debt of Rs 750.09 crore.

But the corporate debt restructuring package was such that the banks could, as of on Wednesday, recover only Rs 557.38 crore, as Kingfisher closed the day at Rs 48.05 per share at the Bombay Stock Exchange (BSE).

After the debt recast, the combined shareholding of Kingfisher’s promoters has declined to 58.61 per cent from 66.28 per cent earlier, said an airline spokesperson.

The composition of stake held by foreign institutional investors, non-institutional investors and corporate bodies will also undergo a changes with an increase in the equity base of the airline.

This cashless transaction was part of the restructuring agreed upon by the banks and the airline last year. Kingfisher, controlled by United Breweries Holdings, had agreed to convert the Rs 1,355-crore of the loans into shares, besides converting the promoters’ debt of Rs 648 crore to share capital. The airline had mandated SBI Caps for the debt restructuring process.

Among the lenders, State Bank of India and ICICI Bank now have about 11 per cent stake in Kingfisher Airlines. SBI was alloted 28 million equity shares on account of conversion of compulsorily convertible preference shares the airline had informed the BSE.

The allotment of shares has given the SBI 5.67 per cent stake in the airline valued at Rs 182.25 crore. ICICI Bank was allotted 26 million shares against the loan it had given to the airline.