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Kingfisher announces CEO and plans to restructure debt

1-Oct-2010 8:07 AM

Kingfisher Airlines appointed (30-Sep-2010) Sanjay Aggarwal as Chief Executive Officer of Kingfisher Airlines Limited with immediate effect and will report to the carrier’s Chairman and Managing Director, Vijay Mallya. Mr Mallya also served as CEO prior to Mr Aggarwal's appointment. Mr Aggarwal was most recently the CEO of Spicejet up until Jul-2010. [more]

Meanwhile, Mr Mallya announced the carrier received a sanction from the Reserve Bank of India to conduct a debt restructuring exercise to work with a consortium of banks to restructure Kingfisher’s entire INR600 crore (USD134.9 million) debt and also convert 30% of the carrier’s total debt into capital ( Express, 30-Sep-2010). A loan of INR735 crore (USD165,1 million) from the carrier’s parent company, UB Holdings, would also be converted into equity. Under the restructuring plan, Kingfisher expects to clear its debts within the tenure of nine years, including a two-year moratorium. Once the debt restructuring is complete the carrier plans to raise approximately USD1 billion in funding, including a USD250 million GDR issue.

Kingfisher also announced plans to expand its fleet by 2012 and to apply for additional international services according to Mr Mallya (Economic Times/Press Trust of India, 30-Sep-2010).

Kingfisher:We have deferred the delivery schedule from Airbus, but with the airline industry picking up, we plan to have a relook and may look at replacing some of our ageing aircraft. We are looking at obviously applying for more routes because now SpiceJet is eligible to fly overseas, Indigo will be eligible to fly overseas next year. Before they come in and grab additional bilateral rights, we want to make sure Kingfisher has already secured these rights.” Vijay Mallya, Chairman and Managing Director of Kingfisher Airlines. Source: Economic Times/Press Trust of India, 30-Sep-2010.