DGCA seeks more details on Kingfisher finances

By: admin
Updated: 28 Dec 2012 08:48 AM

DGCA has sought additional details from Kingfisher Airlines on
how it would fund its revival plan submitted to the aviation regulator for
resumption of its flight operations, official sources said on Friday.

The Directorate General of Civil Aviation (DGCA) has sought more details
from the beleaguered carrier as to how it would garner funds for payment
of dues to its lenders and vendors, apart from paying the pending salaries
of its employees, they said.

Kingfisher CEO Sanjay Aggarwal had informed DGCA chief Arun Mishra on
Monday that the airline would require about Rs 652 crore over the next 12
months to run its operations and the amount would be put in by its parent
company UB Group. Of this, Rs 120 crore would be needed to meet salary
arrears for its employees.

However, there was no word from the UB Group as to how it would commit the
funding and raise it from where. Banks have been unwilling to fund the
cash-strapped airline.

Civil aviation minister Ajit Singh had also said that the airline's parent
company has not disclosed anything regarding funding.

Kingfisher's "financial picture is still not clear. UB Group has not said
anything on the funding of KFA. Its plan is not backed by any clear
funding proposal," he had said.

The sources said the DGCA would soon seek additional details regarding the
funding plan and hold talks with Kingfisher's creditors and other vendors
including airport operators, before deciding on its application seeking
permission to relaunch its services.

With the liquor baron Vijay Mallya-owned airline owing money to its staff,
banks, airports and tax authorities, the sources said all these
stakeholders needed to be convinced that the carrier's interim revival
plan was viable.

Kingfisher, which has a debt of nearly Rs 8,000 crore and accumulated
losses and liabilities of a similar amount, has been grounded since
October one after its pilots and engineers went on strike.