SBI to auction Kingfisher House today, base price set at Rs 150 cr
The SBI-led bank consortium has decided to auction Kingfisher House in Mumbai on March 17 in a bid to recover a part of Rs 6,963 crore debt due from the now grounded Kingfisher Airlines.Updated: Mar 17, 2016 11:05 IST
The SBI-led bank consortium has decided to auction Kingfisher House in Mumbai on March 17 in a bid to recover a part of Rs 6,963 crore debt due from the now grounded Kingfisher Airlines.
The e-auction will be done under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002.
SBICAP Trustee Company Ltd, which took possession of the property last year, will do e-auction of the 2,401.70 square meter property on March 17.
The Trustee Company has kept reserve price of Rs 150 crore and the bid increment amount is Rs 5 lakh, a public notice said.
The earnest money deposit for this auction has been fixed at Rs 15 lakh.
Mumbai: SBI to e-auction Kingfisher House today pic.twitter.com/CavwN9BfSg— ANI (@ANI_news) March 17, 2016
As per the notice, the borrower is Kingfisher Airlines and guarantors are United Breweries (Holdings) Ltd and Vijay Mallya.
It can be recalled that Kingfisher Airlines, started by liquor baron Mallya in May 2005 with much fanfare, went on to become the second largest in its heydays even though it never made a single penny in profit.
As cashflow issues mounted on the airline, it has remained grounded since October 2012, and the airline lost its flying licence two months later.
The SBI-led lenders consortium had taken over the Kingfisher House near city airport in February 2015 worth around Rs 150 crore, after winning the case in the local court.
They have also taken over the Kingfisher Villa in Goa, worth around Rs 90 crore.
So far, the lenders have recovered around Rs 1,600 crore from their original exposure of Rs 6,900 crore by selling pledged shares and other monetisable collaterals.
The banks have moved the Debt Recovery Tribunal, Bengaluru and the Karnataka High Court and the company said it is contesting their claims.
Banks are now charging 15.5 percent compounded interest on this principal amount, which have not been serviced since January, 2013.
SBI has the highest exposure of Rs 1,600 crore to the beleaguered Kingfisher Airlines.
Other banks that have exposure to the airline include Punjab National Bank and IDBI Bank (Rs 800 crore each), Bank of India (Rs 650 crore), Bank of Baroda (Rs 550 crore), Central Bank of India (Rs 410 crore).
UCO Bank has to recover Rs 320 crore, Corporation Bank (Rs 310 crore), State Bank of Mysore, (Rs 150 crore), Indian Overseas Bank (Rs 140 crore), Federal Bank (Rs 90 crore), Punjab & Sind Bank (Rs 60 crore) and Axis Bank (Rs 50 crore).
First Published: Mar 17, 2016 09:42 IST