Mallya revives hopes of Kingfisher Airlines flying again

Kingfisher Airlines chairman Vijay Mallya on Tuesday revived talk of revival plans for the grounded airlines, saying it was in talks with a foreign investor for a potential sale of stake.

Cash-strapped Kingfisher Airlines has been grounded since October last year and has been looking for an investor ever since.

Mallya, however, refused to name the investor, citing confidentiality of agreement.

"The investor is very sensitive to identity being revealed. Let us really give it a good try to get KFA started," he said, adding, "I expect this to take some form or shape in the next 90 days. That is my own estimate."

Mallya was speaking to media persons on the sidelines of the company's annual general meeting in Bangalore on Monday.

Kingfisher Airlines has remained grounded for almost a year now under the burden of huge debts totalling over Rs7,000 crore and accumulated losses of more than Rs16,000 crore.

The airline has also been not paying its employees for several months now.

Mallya said the United Breweries Holdings Limited (UBHL) board has considered the request of KFA Board for continued funding in the interim till the prospective investor brings in the necessary finance.

The request has been made through the court because of a restraint on UBHL, he added.

"UBHL itself cannot use its own funds and its assets that it currently has because of the restraining order from the Karnataka High Court. We have, in fact, applied to the court's permission to use part of this fund, and now it is in the hands of the honourable court," he said.

He also said the approval of the Directorate General of Civil Aviation (DGCA) to the airlines' revival plan is contingent on it submitting a recapitalisation plan.

Mallya said the company had not heard from the aviation regulator on the proposal to restart limited operations.

On the debt issue, Mallya said issues with creditors are bilateral in nature and would talk to them from time to time.

"Some of them have preferred bilateral negotiations in good faithful spirit and some have gone to court. We have to deal with all these issues as they come along," he added.

On the prospects of the aviation sector, Mallya said, "If you take all three components - current crude oil prices, the value of rupee versus the dollar etc - as they exist, obviously it is very challenging. And I don't know whether there can be full recovery."