Veerappa Moily in favour of saving Kingfisher Airlines

Vancouver Star (ANI) Wednesday 22nd February, 2012

Corporate Affairs Minister Dr. M. Veerappa Moily on Wednesday said that he is in favour of saving crisis-ridden Kingfisher Airlines.

"I am as a Corporate Affairs Minister, I want that the company should survive and it should be rescued. How it should be done, it is for the management. There are two elements, about which I always speak, that is one thing is that, why the condition or health of any company fails, that is because of a bad governance," Dr. Moily told the media here.

"I have already told you that will apply to everybody. You must have professional management," he added.

Dr. Moily, however, said that the first step towards revival should come from the company itself.

"Our idea is that any company should survive, any entity should survive, to that extent what government can do, it is always there. But the question that a major initiative should come from the person who has to provide that kind of an atmosphere, where which agency should come to rescue is better known to him," he said.

Civil Aviation Minister Ajit Singh had earlier in the day said the government cannot bailout private airlines like beleaguered Kingfisher Airlines.

"The government is not going to bailout, but we hope Kingfisher can mobilize resources and survive," he told the media in New Delhi.

He further said that that passenger safety issue would not be compromised at any cost.

On reports in the media that the State Bank of India (SBI) is lending over Rs 1600 crores to Kingfisher Airlines, Singh said: "We have said it before that banks will decide on it. If they are satisfied with the business plan, then they can lend the money."

The Directorate General of Civil Aviation (DGCA) had earlier on Tuesday given the Kingfisher Airlines time till today to come up with a revised and a clear schedule for the aircraft that it is still operating.

Kingfisher, controlled by liquor baron Vijay Mallya, has cancelled 32 out of the 240 flights that it operates each day.

Banks own about a quarter of cash-strapped Kingfisher, which has so far been unable to attract fresh equity amid growing worries about its future.

Kingfisher, named after the country's most popular beer, lost 4.4 billion rupees in the fiscal third quarter that ended in December.

It owes over Rs. 7000 crores to an 18 bank consortium led by State Bank of India (SBI) (ANI)