UB Group CFO, Nedungadi, clarifies

Tuesday was also a hectic day for UB Group CFO Ravi Nedungadi, who along with chairman Vijay Mallya, spent the day clarifying issues before the media.

On the airline's debt, Nedungadi said the carrier had debts of Rs6,000-7,000 crore. The company was trying to retrieve Rs1,000 crore by taking back maintenance reserves paid to aircraft lessors and replacing these reserves with standby letters of credit. If successful the move would help the company save paying interests ranging upto 13%.

He also clarified that UB Holdings had not pledged anything except Kingfisher's own shares to the bankers, apart from providing a corporate guarantee. The corporate guarantees were worth about 90% shares of United Spirits and properties that the Group holds in Bangalore.

As for the Kingfisher brand, Nedungadi clarified that the brand, for the purposes of aviation, has been permanently assigned to Kingfisher Airlines. About 15 months back an international valuation had assessed the value of the brand to be about Rs4,500 crore. Along with the pledged shares the brand too could be sold by banks should the need arise.

He also clarified that the Group was not interested in holding onto a majority share in the company and should there be interested parties it would consider reducing its stake in Kingfisher.

In this regard he pointed out that the Group held less than 50% in United Breweries and United Spirits so there was no issue in holding onto a majority stake in Kingfisher.