Mallya to put Rs 425 cr in KFA to restart operations

Kingfisher Airlines (KFA) promoter Vijay Mallya will pump in Rs 425 crore into the grounded airline as the first step to kick-start its operations, albeit in a limited way.

“We discussed the funding plan with UB Group and KFA officials. The promoters would bring in Rs 425 crore into Kingfisher,” said Shyamal Acharya, deputy managing director (mid-corporate), State Bank of India, lead lender to the airline.

Speaking after a meeting that went on for over two hours here, he said airline officials apprised the lenders of talks with foreign air carriers (without naming any) for possible investment in the debt-burdened airline.

KFA had earlier said it was in talks to sell stake to Abu Dhabi-based Etihad but a decision had yet to be taken.

The company did not give a detailed funding plan but it did not ask for any immediate finance from banks, either, Acharya said. The company owes Rs 7,500 crore to banks.

Referring to the future course of action, he said the lenders had decided to form a sub-group of SBI, Bank of India, IDBI Bank and Punjab National Bank to meet at the end of this week or early next week and monitor the developments.

The Kingfisher scrip on Monday declined about five per cent to Rs 16.85 on the Bombay Stock Exchange.