Lenders to auction movable property of Kingfisher Airlines

Mumbai: Bankers, led by State Bank of India, are finally getting into action to recover their Rs 7000 crore loan to Kingfishers Airlines. Lenders have called for bids for the movable assets- primarily vehicles and assets related to airlines business- from prospective buyers.

The action from lenders comes three years after Vijay Mallya promoted airlines’ licence was suspended by aviation regulator – a move that prompted most bans to write off the loan in following year.

Lenders have already taken possession of the Kingfishers House, located close to the Mumbai Airport, although they were not yet able to auction the 17000 square feet property.

On Saturday, lenders said movable property that comprises vehicles and assets related to airlines business will be auctioned December 7, 2015. The vehicles include- tempos, tractors, cars, SUVs, aircraft pullers and luggage trolly. The other assets include ladders, fire extinguishers, hydraulic pole with staircase.

Interestingly, the reserve price has been fixed at Rs 65 lakhs, which is less than 0.01% of the outstanding loan.

Three years after declaring the loan as non-performing assets, lenders have to yet take possession of the promoter Mallya’s palatial villa in Goa. Litigation between the borrower and the lenders had prevented banks from taking possession of the Goa Villa.

Early this week, country’s largest bank - State Bank of India - declared Kingfisher Airlines and United Breweries Holdings as wilful defaulters- preventing these two companies from taking bank loans.