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    HomeNewsBusinessCompaniesICICI Bank agrees to refinance AI's loans worth Rs 5500cr

    ICICI Bank agrees to refinance AI's loans worth Rs 5500cr

    Air India is refinancing loans worth Rs 5,500 crore that the company had taken to buy 21 airbus aircraft. ICICI Bank will invest in guaranteed non convertible debentures issued by the company at an interest rate of 9.8%.

    June 24, 2011 / 09:39 IST
       
       
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      National carrier Air India's turnaround plan is yet to get off the ground. While the much awaited group of minister's meet on aviation yet again failed to take any decision on a decisive course of action, Air India's empty kitty, delay in paying its employees, vendors and oil companies, is slowly taking a turn for the worse. (Click here to know more)


      However, there is some sign of relief for the carrier. Air India is refinancing loans worth Rs 5,500 crore that the company had taken to buy 21 airbus aircraft. ICICI Bank will invest in guaranteed non convertible debentures issued by the company at an interest rate of 9.8%. This is much lower than the interest the company was paying on the 11-year loan taken from IDBI Bank and a consortium of banks which was used to buy the aircraft. For this, Air India will provide government guarantee and pay interest semi-annually to ICICI Bank.


      CNBC-TV18 learns that this deal will help Air India save on interest costs upto Rs 180 crore.

      Here is what the management had to say.

      first published: Jun 23, 2011 09:56 pm

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