Lenders may put Kingfisher property in Mumbai on the block

According to sources, lenders of debt-laden aviation firm Kingfisher Airlines are considering whether to proceed with the auction of Kingfisher House in Mumbai, reports CNBC-TV18’s Kritika Saxena.

This comes a day after the Karnataka High Court rejected a plea by the company restraining bankers from taking possession of the prime property, whose sale could fetch about Rs 90 crore.

State-run lender State Bank of India, which is the lead banker in the consortium of Kingfisher lenders, recently initiated a procedure to take over the KFA House, under the Sarfaesi Act, which facilities recoveries for loans gone bad.

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Kingfisher has been in the news since last year for its troubles over a whopping Rs 7,000-crore debt burden. Failure to make payments over its dues led to the government cancelling its aviation license.

The fate of the airline has taken a toll on the fortunes of other firms in the UB Group stable, with chairman Vijay Mallya having to resort to stake sales in firms such as United Breweries and United Spirts.

There is no progress on the possession of KFA Villa in Goa after the Goa court recently directed the lenders’ consortium to “maintain status quo”, in effect disallowing any sale for now.