Kingfisher Air Fails to Give Funding Details in Revival Plan
Kingfisher Airlines Ltd. (KAIR), the Indian carrier that grounded flights because of a cash crunch, failed to provide a funding plan to the nation’s aviation regulator in its proposal to revive operations.
The revival plan Kingfisher submitted to the authorities earlier this week is “only a wish,” Aviation Minister Ajit Singh told reporters in New Delhi today. The airline’s parent UB Group hasn’t provided any assurance of funding, he said.
The Directorate General of Civil Aviation will hold talks with Kingfisher’s creditors and airport operators before deciding on the proposal, Singh said. The carrier, controlled by liquor tycoon Vijay Mallya, has been seeking cash for more than two years and said it’s in talks with possible investors, including Etihad Airways PJSC.
Kingfisher has also applied to have its operating license renewed. The license was suspended in October after the airline halted services because of a strike by engineers and pilots demanding seven months of unpaid salaries. They agreed to return to work after management pledged to pay the arrears.
The plan presented to the DGCA includes the money needed to support the revival, Kingfisher spokesman Prakash Mirpuri said in an e-mail. The company will show the availability of funds as soon as the regulator is satisfied with the proposal, he said.
The aviation regulator had earlier said that the carrier must provide a “concrete and reliable” revival plan to have its license restored.
Shares of Kingfisher fell 0.3 percent to 15.90 rupees at close of trading in Mumbai. The stock has dropped 24 percent this year.
The carrier plans to restart operations in a phased manner using its own funds, according to a plan the company submitted to bankers on Dec. 17.
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