Now, KFA says in stake sale talks with Etihad, scrip up 5% Kingfisher stock was up five per cent on Tuesday after a media report said a deal between the two would be announced next week

On a day when service tax department detained another Kingfisher plane for default, the second in two days, the airline announced it was in discussions with Abu Dhabi-based Etihad Airways for a stake sale which could revive the troubled airline’s fortune. Executives from Etihad Airways visited Kingfisher offices in Mumbai and Bangalore last week.

Kingfisher stock was up five per cent on Tuesday after a media report said a deal between the two would be announced next week. The report said Etihad had agreed to pick up 48 per cent in the airline for Rs 3,000 crore. While Etihad offered no comment for the story, its chief executive James Hogan told media last week that India and China were now key regions of focus for the airline. He said Etihad was in due diligence with a "couple" of Indian airlines. When asked about a possible deal, he replied : "Ask me in a couple of weeks.''

Kingfisher informed the Bombay Stock Exchange it was in discussions with many investors, including Etihad, but said no agreement had been signed. Kingfisher's market capitalisation is Rs 1,267 crore at current price and the UB Group owns a little over 35 per cent stake. The share price closed at Rs 15.67, up five per cent.

While the stock price got a boost, the ground situation remained the same. Agency reports said lessor International Leasing Finance Corporation, too, had taken back four Airbus planes leased to the airline. A Kingfisher spokesperson said the airline did not comment on its relationship with vendors, while sources said the airline had itself decided to return these.

“The detention of aircraft is illegal and untenable. No authority has any right whatsoever to detain Aircraft owned by overseas lessors. This will give a very wrong signal to any foreigner who wishes to do business in the aviation industry in India,” said Prakash Mirpuri, vice-president, corporate communications, UB Group,

A deal will give Kingfisher Chairman Vijay Mallya much-needed funds to kickstart the airline, but the going may not be easy. Analysts are not too optimistic about Kingfisher benefitting from liberalisation of FDI norms, given its current state. More, there is competition to woo foreign airline partners.

Etihad and Jet Airways have been in discussions for a stake sale for the past few months, and on Tuesday the two airlines cemented the relationship by announcing an expansion of their existing code-share agreement to include the Abu Dhabi-Paris route. The existing agreement covering India-Abu Dhabi routes had been signed in 2008. Second, Kingfisher's operational and financial problems are far from over. Analysts including Kapil Kaul of Centre for Asia Pacific Aviation have said Kingfisher had an outside chance to secure foreign direct investment and any deal will be complex and require significant capital infusion by promoters and concurrence of the banks.

http://business-standard.com/india/news/now-kfa-says-in-stake-sale-talksetihad-scrip5/495348/

Toddy cat strikes Air India flight, costs airline Rs 10 crore

KOZHIKODE: A dash across runway by a common palm civet (paradoxurus hermaphrodites) - also known as toddy cat for its fondness for palm flower sap -- has cost the national carrier Rs 10 crore in damage, making it one of the costliest runway animal incursion accidents in the country in recent times.

Official figures put the total loss of airlines in the country due to bird/animal hits at Rs 18 crore in 2011 and Rs 22 crore in 2010. Bird hits are a common safety hazard but it could perhaps be the first time in aviation history that a palm civet has turned the villain. An expert has confirmed the animal as palm civet after examining the remains retrieved from the runway.

The toddy cat had struck the AI 997 flight from Karipur to Sharjah at 8.06 pm on Saturday, almost bringing down the aircraft. Airline sources said fire was spotted in the engine after takeoff and the pilot had made an emergency landing, averting a major disaster.

They said the animal that got sucked into the engine during takeoff had caused extensive damage. As many as 32 engine blades -- each costing Rs 12.4 lakh - would have to be replaced along with the engine cowling, they said. The blades and the cowling were bought to Karipur from Mumbai on Tuesday. The experts are also conducting a boroscopic examination to find if internal components had sustained any damage.

The incident has also left the Karipur airport authorities flummoxed as it

This is the first time that such an animal had made its way to the runway. Airport director J P Alex said he had asked the zoology department of the Calicut University to provide details regarding the habitat of the animal.

Dr Zubair Medammal, assistant professor, zoology department, CU said the body parts recovered from the runway clearly established that it was a palm civet that struck the aircraft. "We have got traces of fur, skin and flesh of the animal from the runway, which show that it is a palm civet. We are also subjecting the body parts to DNA analysis," he said.

The airport director said the airport environment management committee (AEMC) would meet soon and beef up the airfield security. "We have been rigorously following the safety guidelines; we have an eight-metre-high wall across the nine-km perimeter of the airport. In addition, there is a 1.5 metre barbed fence on top of it. We have also employed six bird scarers. The CISF personnel are also on constant patrol on the perimeter road," he said.

Meanwhile, DGCA air safety regional controller in Chennai S Durai Raj concluded a two-day probe into the incident on Tuesday.

http://m.timesofindia.com/city/kozhikode/Toddy-cat-strikes-Air-India-flight-costs-airline-Rs-10-crore/articleshow/17579726.cms

Kingfisher, Etihad renew deal talks

MUMBAI: Ailing Kingfisher Airlines returned to active discussions for selling a 49% stake to Abu Dhabi carrier Etihad even as investors on Tuesday lapped up shares of the debt-laden company, co-owned by UB Group chairman Vijay Mallya, and a clutch of domestic banks. 

The grounded Kingfisher has been in protracted discussions with Etihad for more than a year, but talks revived in recent weeks, said people briefed on the matter. Kingfisher CEO Sanjay Agarwal and Mallya were leading talks with Etihad, which has reached a crucial stage, they added. "This deal has been in the making for a while and Etihad has stood by us, despite being wooed by others. This is a deal which gives them operational control and a large stake at an attractive valuation," said a source who didn't want to be named as talks were private. He declined to confirm media reports that a preliminary deal could be in place as early as next week. 

Kingfisher Airlines, responding to queries from the stock exchanges, said it was in talks with three potential investors, including Etihad. These are in negotiation stages and no agreement has been reached, the company added. Kingfisher shares were locked at the upper circuit on Tuesday, after rising 5% to touch Rs 15.67 in early morning trade on BSE. 

Mumbai Mirror, a Times Group publication, on Tuesday reported that Etihad was nearing a deal with Kingfisher to buy 48% stake in the latter, and transaction might get announced on December 18, which is Mallya's birthday. Another report earlier this week said Etihad had returned to discussions with Kingfisher after its brief talks with Jet Airways didn't move ahead. 

Jet Airways chairman Naresh Goyal, who fought a bitter battle with challenger Mallya for market share, had stepped into discussions with Etihad after foreign carriers were allowed to buy a 49% stake in domestic airlines. Etihad CEO James Hogan told international media in recent weeks that his company was talking to three Indian carriers for a possible investment, but didn't name any. Etihad acquired a stake in Virgin Australia, Germany's Air Berlin and a 40% stake in Air Seychelles in the past one year. 

"Foreign carriers know that Kingfisher will regain the market share once it starts flying and shoring up market capitalization will be no big deal then. Even lenders will be more than happy to reschedule debts," said investment advisor S P Tulsian, who argued that the troubled airline presented the best bet for any foreign acquirer. Kingfisher carries a debt of Rs 8,000 crore and another Rs 3,000 crore supplier credit compared to Jet's debt of roughly Rs 14,000 crore and supplier credit pegged at around Rs 4,000 crore, Tulsian added. 

Meanwhile, Kingfisher Airlines lenders said they would insist that any new stakeholder should come in by fresh issue of shares into the company rather than sale of shares by promoters. The airline lenders are scheduled to meet on December 17 in Mumbai. "If the airline has to be operational it will need immediate capital for paying off dues to airports, staff and other service providers. This has to come in by issue of new shares so that funds go into the airline," said a lender. "We may agree to another repayment schedule if new shareholder comes up with a viable plan," he added.
http://timesofindia.indiatimes.com/business/india-business/Kingfisher-Etihad-renew-deal-talks/articleshow/17577713.cms

Air India owes Rs 4,064 cr to oil companies

New Delhi, Dec 11, 2012 (PTI):

National carrier Air India owes over Rs 4,064 crore in outstanding jet fuel (ATF) bill to state-owned oil companies, the largest overdue payment by any domestic carrier.

Of the total outstanding of Rs 4,064.77 crore, a sum of Rs 2,571.73 crore is overdue payment, the Rajya Sabha was informed today. Unlike private airlines, Air India has not provided any security to cover for its outstanding.

Air India, the unprofitable state-owned carrier, owes Rs 2,393.79 crore to Indian Oil Corp (IOC), of which Rs 1,698.79 crore is overdue payment, Minister of State for Petroleum and Natural Gas Panabaaka Lakshmi said in a written reply.

It owes another Rs 636.04 crore to Bharat Petroleum Corp Ltd (BPCL) and Rs 1,034.94 crore to Hindustan Petroleum Corp Ltd (HPCL).

Jet Airways owes Rs 958.46 crore to IOC but of this only Rs 35.46 crore is overdue payment. The rest is under 90-day credit period that oil companies extend to Jet and other airlines including Air India.

Lakshmi said Jet ownes Rs 111 crore to BPCL, of which Rs 30.84 crore is overdue.

Jet has covered its outstanding with IOC with a Rs 923 crore bank security which can be encashed in case of default in payment. The outstanding of BPCL has been covered by a Rs 160 crore security.

Kingfisher ran an outstanding of only Rs 79.74 crore with HPCL. Of this only Rs 14.38 core is overdue. It has given a Rs 15.05 crore bank guarantee plus a Rs 200 crore corporate guarantee to cover for its fuel outstanding, she said.

HPCL has steadily encashed bank guarantees provided by Kingfisher to recover its dues.

Go Airlines had all of its Rs 99.56 crore outstanding with IOC more than covered with a Rs 115 crore bank guarantee. Spice Jet too had its Rs 91.03 crore outstanding covered with a Rs 95 crore bank guarantee.

"In case airlines fail to pay their dues, oil marketing companies take action for recovery of dues in line with the mutually-agreed commercial terms between them and the Airlines," she said adding the oil firms put defaulters on 'cash-and-carry' and recover overdue payment by encashing bank guarantee.

Also, oil firms seek post-dated cheques for outstanding dues and file suit in court against defaulting airlines, she said. 

http://www.deccanherald.com/content/297859/air-india-owes-rs-4064.html

Air India sees rise, registers growth in passenger revenue: K C Venugopal

New Delhi: Air India performance has improved for the first time in several years with the national carrier registering growth in passenger revenue and load factor, Minister of State for Civil Aviation K C Venugopal said on Tuesday.
    
In a written reply to a question on Air India's performance in the Rajya Sabha, the Minister informed that the airline's operating performance during April-September quarter of this year has improved in comparison to the corresponding period in 2011.
    
"The passenger revenue has gone up by Rs 328.88 crore, an improvement of 6.1 per cent, yield has improved from Rs 3.43 per kilometres to Rs 4.31 per kilometres and the load factor has improved from 69.3 per cent to 70.9 per cent," Venugopal said.
    
In reply to a separate question, the Minister informed the House that an incident similar to the 2010 Air India Express plane crash was averted at Mangalore airport recently.
    
He said government has classified the occurrence as serious incident and constituted a Committee of Inquiry to carry out an investigation into the matter.
    
"An undershoot landing incident to Boeing 737-800 aircraft VT-AXE of Air India Charters Limited occurred on August 14, 2012 at Mangalore airport while operating flight IX-814 on Dubai-Mangalore sector. The flight number, air route and runway used for landing were same as the Mangalore crash which occurred in 2010," he said. 

http://post.jagran.com/air-india-sees-rise-registers-growth-in-passenger-revenue-k-c-venugopal-1355222985

Plane on runway forces Indigo flight to abort landing

Passengers of an Indigo airline flight experienced tense moments when the flight’s landing was aborted at the Chennai airport on Monday. The flight which left Mumbai at 10 a.m. with over 150 passengers was scheduled to land in Chennai around 11.40 a.m. But when the flight was about to land, the pilot was informed there was another flight on the runway. He had to abort the landing and stay in the air for a while.

J. Joher, a frequent flyer said that he along with the other passengers were worried when the captain apprised them of the situation.

After the take off for the flight on the runway was cleared, the Indigo airline flight landed at 11.55 a.m.

Pilot informed there was another flight on the runway, forced to stay in air for a few minutes

http://www.thehindu.com/todays-paper/tp-national/tp-tamilnadu/plane-on-runway-forces-indigo-flight-to-abort-landing/article4190625.ece

Plane on runway forces Indigo flight to abort landing

Passengers of an Indigo airline flight experienced tense moments when the flight’s landing was aborted at the Chennai airport on Monday. The flight which left Mumbai at 10 a.m. with over 150 passengers was scheduled to land in Chennai around 11.40 a.m. But when the flight was about to land, the pilot was informed there was another flight on the runway. He had to abort the landing and stay in the air for a while.

J. Joher, a frequent flyer said that he along with the other passengers were worried when the captain apprised them of the situation.

After the take off for the flight on the runway was cleared, the Indigo airline flight landed at 11.55 a.m.

Pilot informed there was another flight on the runway, forced to stay in air for a few minutes

http://www.thehindu.com/todays-paper/tp-national/tp-tamilnadu/plane-on-runway-forces-indigo-flight-to-abort-landing/article4190625.ece

Kingfisher loses six more planes

Kingfisher Airlines lost six more aircraft owing to non-payment of lease rentals and tax dues, even as the beleaguered carrier said on Tuesday that it was in talks with the Gulf-based Etihad Airways and various investors for equity infusion. Amid reports of a revival plan before the month—end, the airlines’ troubles compounded further with a US—based leasing company taking back four of its Airbus planes following non—payment of lease rentals.

http://www.thehindu.com/todays-paper/kingfisher-loses-six-more-planes/article4190152.ece

Pay dues or vacate, Mumbai airport tells Kingfisher

New Delhi, Dec 11:  

In what could spell more trouble for the cash-strapped Kingfisher Airlines, the Mumbai airport has asked it to pay dues worth Rs 50 crore or vacate the space it has at the airport.

Sources confirmed to the Business Line that a communication had been sent to the airline to clear its dues.

The letter, however, is not an eviction notice but a reminder to the airline company to settle its dues.

Mumbai airport is one of the largest operating bases for Kingfisher Airlines.

A consortium headed by the GVK Group is undertaking the modernisation of Mumbai airport.

Meanwhile, the airline has clarified to BSE that while it was in discussion with various investors, including Etihad Airways, for equity investment, no agreement “has been reached either with Etihad or any other airline and the matters are merely at a negotiation stages”.

The statement adds that the company had been attempting to raise the much-needed capital over the last two years since the shareholders approved it.

The Kingfisher Airline stock ended almost five per cent higher on BSE at Rs 15.67 amid reports that it had concluded a deal with Etihad for a 48 per cent stake sale.

The airline, which has an outstanding of over Rs 8,000 crore, suspended operations on October 1, after engineers refused to certify its aircraft as being safe to operate.

On October 20, the Directorate General of Civil Aviation suspended its operating licence.

Recently the airline promoter, Vijay Mallya, met the Directorate General of Civil Aviation and indicated that an investor was likely to be announced before December 31 when the licence comes up for renewal.

The Service Tax Department has impounded an ATR aircraft of the airline for failing to meet tax dues of around Rs 63 crore.

http://www.thehindubusinessline.com/todays-paper/tp-logistics/pay-dues-or-vacate-mumbai-airport-tells-kingfisher/article4189061.ece