Kingfisher Airlines gets RBI nod to restructure debt

Kingfisher Airlines has got the Reserve Bank of India's sanction for a debt restructuring exercise, and the company is working with a consortium of banks to restructure its debt with about 30 per cent of the total debt to be converted by banks into capital.

A loan of Rs 735 crore from UB Holdings, which is the parent company, to the airline, would also be converted into equity for which resolution was passed. The debt restructuring exercise is expected to take 1-2 months to complete, as banks will have to “get approval from their respective board”.

There will be an interest rate reduction to an average of 11 per cent, it will be a door-to-door tenure of nine years, with two years as moratorium and a seven-year easy repayment schedule.