Liquor distributors of Vijay Mallya's UB group are expected to pool in Rs1,000 crore in a last-ditch effort to bail out the beleaguered Kingfisher Airlines.
This would fulfill one of the creditor banks' conditions that Kingfisher bring in fresh capital to enable them lend additional amounts to the airline, which is fully drenched in debt.
While nothing has been finalised as yet, the funds are expected to come in as investments by associates in either equity or debt capital of Kingfisher Airlines.
The move comes amidst reports of the airline restricting operations to a skeleton 120 daily flights involving 20 dedicated aircraft.
Kingfisher Airlines owed a total of Rs5,608.07 crore to a consortium of 13 banks, including state-run and private sector lenders, as of February this year.
According to latest estimates by the banking consortium, Kingfisher has availed of over Rs7,000 crore in loans, including Rs4,000 crore of term loans.