Grounded Kingfisher wins Centre’s sympathy

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Vijay Mallya’s Kingfisher Airlines has landed belly-up – lenders are closing in on him and he is in danger of losing leased aircraft.

The King of Good Times has sent the Centre an SOS. But will the government bail him out is the million-dollar question.

Mallya has been meeting ministers and indications are some in the government are sympathetic. Recently, SBI approached RBI seeking permission to restructure Kingfisher’s debts outside the corporate debt restructuring mechanism usually reserved for ailing companies. Otherwise, Mallya would not be able to raise more debt.

Mallya owes banks thousands of crores and a few thousand crores to airport authorities and public sector oil marketing companies. He reportedly wants the same treatment from the government that Air India is getting.

He has probably forgotten the government has a huge stake in Air India and no stake in Kingfisher, officially, at least.

Ironically, Air India’s fall was in part caused by alleged favours extended by the government to private airlines such as Kingfisher.

Industry sources said Kingfisher, though the second-largest private airline in the country, never made profit. Yet, Mr Mallya bought Captain Gopinath’s 'Flying Udupi restaurant' (Deccan Aviation) in 2007.