Recapitalization for Kingfisher says CEO, Sanjay Aggarwal

Now Kingfisher is planning to launch six grounded aircraft back to work by next week. Once the company debt payments are made, Kingfisher is planning to get more aircraft off the ground as it has 20 engines which can be mounted on aircrafts.

SBI Caps report states that KFA needs an equity infusion of 3,000 crore to survive of which 1,500 crore must be provided by the promoters. “The best solution (for Kingfisher) is a combination of equity and some loan from the banks in the interim while the equity infusion is complete. The full $500-million solution will not come from the banks. The reason for this is that the cost of money in India is way too high and that is a very expensive way to fix the problem”, Aggarwal said.

Market Analysts predicts that if a private equity player comes in Kingfisher, it will be through a structured deal. An anonymous Equity Analyst said, “In public eye, it will be a private equity deal but in all likelihood, it is going to be a structured deal with a fixed IRR (internal rate of return)”.