UB Grp in talks with FIs for funding Deccan pie

Vijay Mallya-promoted UB Group, which has acquired 26% stake in Air Deccan for Rs 550 crore and is to buy another 20% through an open offer, has initiated talks with financial institutions to fund the takeover.

UB Holdings has only four weeks time to tie up funds. The process of talks with financial institutions have begun, Ravi Nedungadi, chief financial officer, UB Group told PTI over the phone.

"In another three week's time, we should be able to finalise," he said, however, declining to name the financial institutions the group is currently talking to.

Last week, Mallya's UB Group paid an advance of Rs 150 crore towards the 26% stake -- which would be through an issue of 96,77,419 fully paid-up equity shares.

The remaining amount would be paid to Air Deccan's promoter Deccan Aviation in the coming four weeks. The transaction had valued Air Deccan at Rs 155 a share.

Asked about market reports on Anil Ambani Group's interest in picking up stake in Kingfisher Airlines, he said there was no such development.

"We are not talking to them nor they have approached us. We are talking only to financial institutions," he added.

UB Group's acquisition of stake in Deccan Aviation will make Kingfisher and Air Deccan formidable opponents of Jet Airways, which took over Air Sahara, and the merged entity of Air India and Indian.

Kingfisher and Air Deccan will have a combined fleet of 71 aircraft and 70 destinations and would have over 30% of the Indian aviation market.