Shares of ailing Kingfisher Airline gained just after its parent United Breweries Holdings Ltd. has announced to provide additional loans of Rs.450 crore to grounded airline, reports said.
In an attempt to reduce pressure of ailing Kingfisher Airlines, UB, sought shareholders’ approval, has raised the limit of loans for Kingfisher to Rs 750 crore from Rs 300 crore,
Meanwhile, stock market cheering the move as Kingfisher Airlines stock gained 5 per cent to close at Rs.10.03, while UB Holding shares closed with a loss of 3.78 per cent.
Sudden move of UB is the outcome of lender’ futuristic action plan to recall all their loans, reports said.
An immediate call for loan repayment, debt-laden Kingfisher threatened by its lenders to recover 70 bn rupees of loans, selling shortly some of the shares in UB Group companies given as collateral.
They threatened to take control over all assets given by the airline as security against the loans as it has failed to come up with any credible plan to restart operations and payment of dues.
Sources said that reacting over lenders’ warning, UB Group promised that it would very soon come up with funding using proceeds from a stake sale in a separate group company to Diageo Plc.