Kingfisher creditors sells shares in company pledged as collateral

Victoria
By Victoria April 10, 2013 11:13

Kingfisher creditors sells shares in company pledged as collateral

 

A consortium of Indian banks that are owed $2.5bn by Kingfisher Airlines have confirmed the sales of 10 million shares in Mangalore Chemicals & Fertilizers Ltd, a chemical company that is part of Vijay Mallya’s business empire, which had been pledged as collateral for loans to help finance Kingfisher’s expansion.

A Mumbai court last week declined Mallya’s petition to block Kingfisher’s lenders from selling collateral. The banks plan to serve Kingfisher legal notice in the next couple of days to recover their remaining debt. Once served, Kingfisher will have 60 days to repay its debt or face the loss of more pledged shares and assets that is estimated to total $1.1 billion.

It has also been confirmed (long reported by this news service) that only two of the 17 aircraft leased by Kingfisher Airlines have received airworthiness certificates allowing them to be flown out of the country. The rest have been cannabalised for parts including APUs, landing gears, engines and even seats.

Victoria
By Victoria April 10, 2013 11:13
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