Kingfisher, BPCL reach out of court settlement over dues

Airline major Kingfisher settled its Rs 314 crore payment default case with Bharat Petroleum Corporation (BPCL) today. CNBC-TV18's Ashwin Mohan reports.
Here is a verbatim transcript of Ashwin Mohan's comments on CNBC-TV18. Also watch the accompanying video.

Kingfisher seems to have made BPCL an offer it can't refuse. The Bombay High Court today disposed appeals of both the parties and has accepted the consent terms, which were forwarded by both the parties. What we are picking up from sources is that these consent terms were arrived at by both the parties today and here is how the settlement route between both the parties is expected to pan out.

Firstly, there will be a downpayment of Rs 40 crore, which has to be paid by Kingfisher to BPCL over the next 12 days. November 16 is the deadline for Kingfisher to pay this particular downpayment. The balance amount, that is Rs 314 crore minus Rs 40 crore, is to be paid by Kingfisher over monthly installments spanning a period of one year.

There is a clause over here; each monthly installment has to be a minimum of Rs 10 crore. So, those are the contours of this out of court settlement.