KFA gets Rs 60cr from banks, airlines' mgmt to meet staff
Cash-strapped Kingfisher Airlines got a lifeline as banks agreed to release Rs 60 crore for the airline to pay its employees. Kingfisher Airlines will be able to pay its employees salaries with half that amount.
October 05, 2012 / 11:13 IST
Cash-strapped Kingfisher Airlines got a lifeline as banks agreed to release Rs 60 crore for the airline to pay its employees. Kingfisher Airlines will be able to pay its employees salaries with half that amount. But the lockout has been extended till October 12. The airline management will be meeting employees again on Friday after talks failed on Thursday.
The move to release the money came after the Income Tax department lifted the freeze on Kingfisher's accounts on Thursday and now Rs 30 crore will be released for the payment of salaries of the airline staff. Sources said that some amount of money may also be released for meeting operational expenses. After Thursday's meeting between Kingfisher CEO Sanjay Aggarwal and employees failed to resolve the situation. Kingfisher also issued a statement saying, "We regret that the illegal strike has still not been withdrawn and normalcy has not been restored in the company, thereby continuing to cripple and paralyse the working of the entire airline. In light of this, Kingfisher Airlines Ltd has been constrained to extend the partial lockout which commenced from 1st of October up to Friday the 12th of October, 2012." The cash-strapped airline blamed the extension of the lockout on the "illegal strike that has not been withdrawn". The airline said that it was forced to declare the lockout "in view of the illegal strike perpetrated and continued by a fraction of technicians, AMEs and pilots". "We regret that the illegal strike has still not been withdrawn and normalcy has not been restored in the Company, thereby continuing to cripple and paralyse the working of the entire Airline," said the statement. Another fallout of the airline crisis, Kingfisher company secretary Bharath Raghavan resigned on Thursday. There was more confusion after the meeting as a Kingfisher Airlines official claimed that 100 employees were ready to resume work, but the airlines denied any such development. Kingfisher lenders will be holding an emergency meeting later on Thursday in Mumbai at the SBI Bhawan. Kingfisher Airlines spokesperson denied the statement given by VP, Corporate Affairs, Sanjay Bahadur after the meeting. He said that Bahadur is not official spokesperson and that no such assurance has been given as yet. Later, the official also said that Sanjay is not a spokesperson for the company, which clearly indicates the confusion within the ranks of Kingfisher Airlines and its desperate attempts in trying to seek employee confidence. Meanwhile, Aviation Minister Ajit Singh has said that Kingfisher Airlines will have to take permission from the DGCA to fly. "We have made it clear that Kingfisher has to get DGCA's permission if it wants to fly. Certified engineers have to approve it and the employees issue has to be sorted out," Ajit Singh said. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
