Banks swallow Vijay Mallya's pride

Lenders likely to sell the property situated on a 25,850 sq ft plot

Banks took possession of the Kingfisher House, the erstwhile head office of debt-laden Kingfisher Airline, on Sunday. The lenders are likely to sell the property situated on a 25,850 sq ft plot, which includes the office premises of over 17,072 sq ft, situated on the Western Express Highway near the domestic terminal in Mumbai.

 

Till recently, the ground plus one-storey structure with glass facade and basements with two levels housed the office of the airline’s CEO Sanjay Aggarwal and the legal and finance departments, as all other staff were shifted last year to the new head office -- Qube, a leased premise near the international terminal. The airline initially had three floors in Qube. But in February, there were media reports of power supply being snapped in the office over non-payment of dues. The airline now occupies two floors in that building.

 

 

Banks now say they might also take possession of the beachfront Kingfisher Villa in Goa, which is owned by UB Holdings Ltd (UBHL) and pledged as collateral to the State Bank of India, Kingfisher’s lead bank. But Mallya’s UB Group wants to swap the villa for another asset and says it has the right to do so. SBI is resisting.

 

Kingfisher Airlines owes over Rs 6,000 crore to a consortium of lenders led by the State Bank of India. The country’s largest bank has an exposure of Rs 1,600 crore, while others such as Punjab National Bank and IDBI Bank have exposures of Rs 800 crore each. The Bank of Baroda (BoB) and Bank of India (BoI) had lent Rs 550 crore and Rs 650 crore, respectively.