UB's Foreign Liquor Assets to Save KF Airlines?
By siliconindia   |   Monday, 16 January 2012, 21:16 IST
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UB's Foreign Liquor Assets to Save KF Airlines?
Bangalore: The United Breweries Group or UB Group is looking forward to unite its foreign alcohol assets under one brand ahead of a possible overseas listing of a unit, reports Reuters. This could be a way to raise funds for drowning Kingfisher Airlines. According to a newspaper, UB will bring its foreign liquor assets under the Whyte & Mackay whisky brand and list the Scottish subsidiary. Struggling Kingfisher, controlled by UB Group head, Vijay Mallya, has been forced to cancel flights and is facing troubles in paying interest payments and salaries to employees, as the airlines is running into a debt of 7,500 crore. Minister of State for Finance, Namo Narain Meena informed the Parliament that United Breweries Holdings, which is led by Mallya, earlier had given a corporate guarantee of Rs 1,601.43 crore. Mallya has been in contact with ministers and the interactions are heading in a positive way. Moreover, SBI approached RBI requesting permission to restructure Kingfisher's debts outside the corporate debt restructuring mechanism usually reserved for ailing companies. A person close to the group as saying in relation to the Whyte & Mackay plans said, "This is the right time to start the process, as global recovery is months away." Ravi Nedungadi, Chief Financial Officer of the UB Group said, "When we have something to announce, we will first talk to our stakeholders and then we will tell the press." Whyte & Mackay, acquired by UB sold liquor brands in 2009 for $595 million. A spokesperson of the UB Group said, "We have talked about listing W&M right from the time of acquisition. However, there are no immediate plans in the offing." Reacting to reports of the group leveraging on the proceeds from a possible listing of W&M to bail out ailing group firm Kingfisher Airlines, the spokesperson said: "We would like to clarify that any plans we may have for Whyte & Mackay has nothing to do with Kingfisher Airlines." In December 2011, the government had informed Parliament that Kingfisher Airlines has an outstanding loan of about 6,419 crore, and the lenders include SBI, IDBI Bank, Punjab National Bank, Bank of India and Bank of Baroda. Recently Mallya, who is also a Rajya Sabha MP, has held a series of meetings with top government functionaries, including Finance Minister Pranab Mukherjee, to work out steps to keep the airline afloat.

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