Kingfisher board okays raising up to Rs 5,000 cr

Vijay Mallya-owned Kingfisher Airlines today received board approval to raise up to Rs 5,000 crore (about $1 billion) through various means including preference shares, equity shares or global depository receipts (GDRs).

The company in a statement said that it would raise the capital through various instruments including preference shares or equity shares or GDRs or such other instruments subject to the approval of the shareholders.

"The company will immediately seek to raise up to $250 million by way of GDR and a further Rs 500 crore through a domestic offering subject to necessary regulatory approvals," the company statement said.

The funding exercise will complete within next 3-4 months, the statement added.

The debt burden of the airline as on March 31 2010, stands at Rs 6,000 crore and bulk of it consists long-term loans.

The board of the Kingfisher also approved an increase in the authorised Equity Share Capital from Rs 900 crore to Rs 1,650 crore and an increase in the authorised Preference Share Capital from Rs 100 crore to Rs 2,600 crore, the statement added.

The airline is also awaiting the Reserve Bank's guidelines on relaxing loan norms for the aviation sector.

Kingfisher Airlines scrip ended at Rs 59.35, shedding 0.84 per cent from the previous close, on the Bombay Stock Exchange amid a weak broader market.