Kingfisher beats deadline, clears MIAL dues
16 May 2011
Mumbai: Vijay Mallya-owned Kingfisher Airlines has averted a major crisis by clearing airport charges dues with the Mumbai International Airport Ltd (MIAL). The airport operator had given the airline a deadline of 14 May to clear dues outstanding from last year December.
"We have received a cheque payment for Rs105.71 crore and with that the issues regarding payment default has been resolved. The airline can operate normally from our airport," Mumbai International Airport president Rajiv Jain said.
MIAL had threatened to put the Bangalore-based carrier on a cash-and-carry mode of operations if it failed to clear dues by 14 May.
Last year December Kingfisher had promised to clear dues by February, but the cheque issued by it bounced.
Kingfisher restructured Rs750 crore of its overall debt of Rs6,900 crore last November.
Currently in the sixth year of its operations, Kingfisher is yet to turn the corner. It is likely to post losses in the fourth quarter as well.
On 6 April a consortium of 13 banks, led by the State Bank and ICICI Bank, converted Kingfisher's Rs750 crore debt into 23.37 per cent equity, valuing the airline's share at Rs64.48. With this conversion of equity shares, the promoters holding in the airline has declined to 58.6% from 66.2%.
The carrier hopes to raise around $300 million from a global depositary receipts issue once market conditions stabilise and its share price regains some of its lost value.