Kingfisher Airlines, which has teetered on the brink for months, will be fully recapitalised within six to eight weeks, Sanjay Aggarwal, CEO, Kingfisher Airlines has said. The airline is confident of an equity infusion of USD 500 million to USD 600 million through a mix of fresh funds as well as capital from the banks, Aggarwal stated, according to a report in the Economic Times report by Manisha Singhal.
Aggarwal’s optimism is based on expectations that private equity investors will find the low valuations attractive,
coupled with the hope of a change in foreign investment rules allowing global airlines to invest in local carriers. In an interview, the first after the recent imbroglio over frozen bank accounts, unpaid bills and a fast depleting roster of employees hit the headlines, Aggarwal insisted that the agony will soon be over. Aggarwal, an industry veteran who was among the 40 top executives out of 40,000 employees in US Airways, before it was acquired by United Airlines, is now more attuned to the Indian aviation sector. During the interview, his desk was strewn with copies of dockets detailing the turnaround that he piloted in another situation in a rival airline. “The process (to give the deal a tangible shape) takes six to eight weeks and we are aiming to get the investors in by then. We have a mix of investors but will not be able to disclose further details,” Aggarwal said. “We are approximately looking at a USD 500 million infusion. We have requested banks for non-fund based limits and so between fresh money and some of the non-fund based limits could be the total solution,” he added. Kingfisher plans to get six of its grounded aircraft back in the air by next week, adding to the 28 it is currently flying. It is in a process of submitting a summer schedule to civil aviation regulator, the Directorate General of Civil Aviation that will target getting more aircraft off the ground as it has 20 engines that can be mounted on the aircraft once the payments are made. Aggarwal was at the helm of SpiceJet, when the low-cost airline was scripting a turnaround but quit when Kalanithi Maran acquired the airline and brought in his own team to manage the airline. However, it was during Aggarwal’s tenure that SpiceJet manoeuvred itself out of turbulent weather, enabling Wilbur Ross, vulture investor to exit in favour of Maran. Ross is one of the few investors in the Indian aviation industry to exit profitably. Aggarwal, however, did not specify how much stake will be offloaded if a private equity player comes in but said that the promoters will be in a comfortable position even if a 49 per cent holding is offloaded in Kingfisher as they will still be able to retain 40 per cent .
Click here to see the original article>coupled with the hope of a change in foreign investment rules allowing global airlines to invest in local carriers. In an interview, the first after the recent imbroglio over frozen bank accounts, unpaid bills and a fast depleting roster of employees hit the headlines, Aggarwal insisted that the agony will soon be over. Aggarwal, an industry veteran who was among the 40 top executives out of 40,000 employees in US Airways, before it was acquired by United Airlines, is now more attuned to the Indian aviation sector. During the interview, his desk was strewn with copies of dockets detailing the turnaround that he piloted in another situation in a rival airline. “The process (to give the deal a tangible shape) takes six to eight weeks and we are aiming to get the investors in by then. We have a mix of investors but will not be able to disclose further details,” Aggarwal said. “We are approximately looking at a USD 500 million infusion. We have requested banks for non-fund based limits and so between fresh money and some of the non-fund based limits could be the total solution,” he added. Kingfisher plans to get six of its grounded aircraft back in the air by next week, adding to the 28 it is currently flying. It is in a process of submitting a summer schedule to civil aviation regulator, the Directorate General of Civil Aviation that will target getting more aircraft off the ground as it has 20 engines that can be mounted on the aircraft once the payments are made. Aggarwal was at the helm of SpiceJet, when the low-cost airline was scripting a turnaround but quit when Kalanithi Maran acquired the airline and brought in his own team to manage the airline. However, it was during Aggarwal’s tenure that SpiceJet manoeuvred itself out of turbulent weather, enabling Wilbur Ross, vulture investor to exit in favour of Maran. Ross is one of the few investors in the Indian aviation industry to exit profitably. Aggarwal, however, did not specify how much stake will be offloaded if a private equity player comes in but said that the promoters will be in a comfortable position even if a 49 per cent holding is offloaded in Kingfisher as they will still be able to retain 40 per cent .