Corporate Feb 15, 2013
UB Group, the parent of debt-laden Kingfisher Airlines, said it was in talks with lenders to the carrier to cut their exposure by using proceeds from a stake sale in a group company to Diageo .
While the airline has recieved no formal communication from the banks, it told CNBC-TV18 that banks have explicitly supported the transaction with Diageo.
" The airline is in talks with banks to find an orderly method of disposal of some pledged shares to Diageo if appropriate," sources in the airline told the channel.
The statement comes days after lenders to Kingfisher said they would move ahead towards recovering $1.4 billion of loans in default after the company failed to come up with a viable funding plan.
UK drinks group Diageo agreed last November to buy a 53.4 percent stake in UB Group-controlled United Spirits Ltd for $2.1 billion under a two-stage process.
Kingfisher, which has been stripped of its flying licence and has not flown since October, owes an estimated $2.5 billion to banks, staff, airports and oil companies.
With inputs from Reuters
More From Firstbiz Staff.