Active Stocks
Thu Apr 18 2024 15:59:07
  1. Tata Steel share price
  2. 160.00 -0.03%
  1. Power Grid Corporation Of India share price
  2. 280.20 2.13%
  1. NTPC share price
  2. 351.40 -2.19%
  1. Infosys share price
  2. 1,420.55 0.41%
  1. Wipro share price
  2. 444.30 -0.96%
Business News/ Companies / News/  Kingfisher gives no firm commitment on clearing salary dues
BackBack

Kingfisher gives no firm commitment on clearing salary dues

Mallya said he doesn’t have the money to pay salary dues, according to a Kingfisher executive

Mallya, who met 15 employee representatives on Friday at his residence before leaving for the Formula 1 race in Montreal, told employees that his hands were tied. Photo: Hemant Mishra/Mint (Hemant Mishra/Mint)Premium
Mallya, who met 15 employee representatives on Friday at his residence before leaving for the Formula 1 race in Montreal, told employees that his hands were tied. Photo: Hemant Mishra/Mint
(Hemant Mishra/Mint)

Mumbai: Vijay Mallya, chairman of the grounded Kingfisher Airlines Ltd, didn’t give a firm commitment or any timeframe on clearing salary dues to airline staff, citing legal barriers, after a two-hour meeting with protesting employees, according to airline executives.

Mallya, who met 15 employee representatives on Friday at his residence before leaving for the Formula 1 race in Montreal, told employees that his hands were tied.

The Karnataka high court has barred the group from spending any money until the court gives its final judgement on a winding-up petition filed by lenders, said one of the executives cited above, declining to be identified.

At least 14 bankers have filed a winding-up petition against UB Group and its associate companies to recover their 7,000 crore loan. On 9 November, UB Group company United Spirits Ltd agreed to sell its 53% stake to UK’s Diageo Plc.

According to a second Kingfisher Airlines executive, who also sought anonymity, Mallya said he doesn’t have the money to pay salary dues as he “cannot use the proceeds from the United Spirits-Diageo deal for this due to an injunction from the Karnataka high court".

The executive added that Mallya asked airline chief executive officer Sanjay Aggarwal to hold discussions with employees.

The meeting followed a silent protest by at least 75 employees at the airline’s headquarters in Mumbai—Kingfisher House—demanding salaries pending since July 2012. The protest began on Thursday.

Mallya is a co-owner of the Force India Formula 1 team.

Kingfisher’s Aggarwal, who was mediating in the discussions, did not return calls seeking confirmation.

A Kingfisher Airlines spokesperson declined to offer comments.

Earlier this week, employees of the stricken airline had a meeting with Ravi Nedungadi, chief financial officer of the UB Group, the airline’s parent company.

Kingfisher hasn’t flown since October after its operating licence was suspended by the Directorate General of Civil Aviation (DGCA) following a strike by employees. The licence has since expired, although it can be renewed within two years.

Kingfisher Airlines’ loss in the fourth quarter widened to 2,141.80 crore from 1,151.83 crore in the year-ago period. For fiscal year 2013, the airline posted a net loss of 4,001.12 crore against a loss of 2,328.01 crore in the previous year. Kingfisher Airlines has never made a profit since its inception in 2005.

In April, Kingfisher Airlines submitted a fresh revival plan to DGCA. Permission to resume flights wasn’t forthcoming as the airline didn’t have no-objection certificates from various stakeholders, including airport operators, bankers, jet fuel vendors and spare parts sellers to whom it owes payments.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Published: 07 Jun 2013, 11:46 AM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App