SC Lowy in talks for $125m Kingfisher deal - report

Debt-ridden Kingfisher confirmed to NDTV that it is negotiating with the prospective investor, and hopes to close the deal by the end of January.

Last month, another Hong Kong-based private equity firm, Bravia Capital, was also reported to be considering backing the airline, after government sources said there were no restrictions on investments from China, including Hong Kong, in any airline in India.

Kingfisher's management has said it would consider reducing its shareholding from 58.61% to 26% in order to boost working capital and lower interest payments.

In November, meanwhile, Kingfisher was thought to be close to finalizing a $370 million recapitalization deal with an Indian private investor and a group of banks. Owner Vijay Mallya said at the time that the company would receive a short-term loan of $118 million from a group of 14 institutions led by State Bank of India, to be used as working capital. The deal fell through, however, as the banks refused to part with any further debt until the promoters raised more capital.

Mallya also claimed to be in late-stage negotiations with an unnamed domestic financier looking to provide a $250 million equity injection.

Kingfisher currently holds $1.3 billion worth of debt on its books, despite reporting sales of INR15.28 billion ($296.6 million) for the second quarter of 2011.

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• Topics
• South Asia
• Consumer
• Restructuring
• Consumer
• India
• Distressed
• Bravia Capital