Kingfisher Air raises Rs 50 crore from IL&FS

The company, in the recent past, has been putting in place all the required strategies for the launch which is expected to take on the established airlines in the country.

Confirming the development, Ravi Nedungadi, CFO, UB Group said: "We have raised this Rs 50 crore as a short-term loan in the regular process of putting in place the ground work for Kingfisher Airlines. We should be able to repay the debt within a month from now."

UB Group, till this debt, had been funding the entire operations of the airline from its internal accruals and also by selling its stake in the group's portfolio companies such as Bayer CropScience.

Kingfisher Airlines is looking at operationalising 12 aircraft this year (nine A320s and three A319s) through a mix of leasing and buying from Debis Air, Babcock, Singapore Air Leasing and Airbus.

The company is also in touch with European Credit Agency for soft loans to fund further acquisition of aircraft at a later stage.

The company has booked 30 aircraft, 10 firm orders and 19 options in a single-class configuration of 174 seats. Except an additional order for two Airbus A319s, all the aircraft ordered by the airline are A320s.

The airline has already obtained night parking slots in Delhi, Mumbai and Bangalore. Over 70 cabin crew and more than 40 pilots have been recruited.

The UB Group had sold its entire holding in Bayer CropSciences for Rs 36 crore which has been used to part finance the Rs 60 crore seed capital required for Kingfisher Airlines. The total equity of Rs 155 crore is so far set to be fully funded by the UB Group.