Kingfisher converts SBI debt into preferential shares

Mumbai: Kingfisher Airlines on Thursday said it has allotted 5.68 per cent shares to the State Bank of India on a preferential basis under the debt recast plan. The allotment is valued at around Rs180 crore,

Kingfisher Airlines chief financial officer, Ravi Nedungadi, told media sources that the new equity shares were issued to SBI under the master debt recast plan which the airline had accepted late last year. SBI is the Bangalore-headquartered carrier's largest lender.

The Kingfisher board had approved a debt recast plan in November last year under which the carrier would convert some of its debt into equity in a bid to reduce the interest burden. The airline then mandated SBI Caps for debt restructuring.

Kingfisher, controlled by United Breweries Holdings, agreed to convert Rs1,355 crore worth loan into shares and also chalked out a plan to convert founders debt of up to Rs648 crore into share capital as well.