UB Group is flying out from the low-cost aviation space in what is seen as a last attempt to salvage the debt-ridden Kingfisher Airlines (KFA).....
Ravi Nedungadi, president and chief finance officer at United Breweries (UB) Group said the company is looking at various ways of inducting capital into its cash-strapped businesses. “We are looking at initiatives to ramp up revenues,” he said.
UB Group is flying out from the low-cost aviation space in what is seen as a last attempt to salvage the debt-ridden Kingfisher Airlines (KFA).
Moneycontrol.com first broke the news on August 1 about Kingfisher's exit strategy aimed at shifting focus to its full service operations, which has been struggling to grow in market share. (Click here for the article)
While, its low-cost rivals like Indigo and SpiceJet were steadily narrowing the gap.
Nedungadi said the company plans to up fleet capacity by over 10% without incurring high costs. “We will restructure Kingfisher’s debt very soon,” he said.
The company has also got shareholder approval for a Rs 2,000 crore rights issue. According to Neeraj Monga of Veritas Investment Research, the cash-strapped airlines may need Rs 3,000-4,000 crore to get itself back on its feet. "Nearly 23% of the airline is owned by banks," he said adding, "UB Holding needs to find rights issue externally."
But Nedungadi was confident about the issue going through. He said banks will apply to KFA’s rights issue to average costs.
“The rights issue will be priced around three-four months’ average KFA stock price,” he informed.
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UB Group is flying out from the low-cost aviation space in what is seen as a last attempt to salvage the debt-ridden Kingfisher Airlines (KFA).
Moneycontrol.com first broke the news on August 1 about Kingfisher's exit strategy aimed at shifting focus to its full service operations, which has been struggling to grow in market share. (Click here for the article)
While, its low-cost rivals like Indigo and SpiceJet were steadily narrowing the gap.
Nedungadi said the company plans to up fleet capacity by over 10% without incurring high costs. “We will restructure Kingfisher’s debt very soon,” he said.
The company has also got shareholder approval for a Rs 2,000 crore rights issue. According to Neeraj Monga of Veritas Investment Research, the cash-strapped airlines may need Rs 3,000-4,000 crore to get itself back on its feet. "Nearly 23% of the airline is owned by banks," he said adding, "UB Holding needs to find rights issue externally."
But Nedungadi was confident about the issue going through. He said banks will apply to KFA’s rights issue to average costs.
“The rights issue will be priced around three-four months’ average KFA stock price,” he informed.
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