New Delhi, Nov 11: Beleaguered Kingfisher Airlines today sought government help for a bailout on a day when its shares crashed to a record low amid continuing debt fears, as it cancelled more flights for the fifth straight day with 40 flights being withdrawn.
With his cash-strapped airline hitting a air pocket, its owner Vijay Mallya made a urgent request to Finance Minister Pranab Mukherjee and Civil Aviation Minister Vayalar Ravi to help his carrier in infusion of funds through banks at low interest rates, besides other concessions in line with what Air India was getting, sources said today.
The stocks of the airline plunged to an all-time low to 19.1 per cent in early trading on the Bombay Stock Exchange to a record low before recovering to 9.45 per cent.
Hundreds of passengers were inconvenienced after the private airline went on a cancellation spree amid reports of travel agents not taking bookings. With today's cancellation of 40 flights, at least 160 scheduled flights were not operated since Monday.
Observing that Kingfisher was “facing a problem”, Ravi said Mallya had met him and explained the problem. “I will also talk to the Finance Minister ... (so that) some assistance from the lead banks is granted. ... Closing down of flights affects the travelling public.
“Whether it is private or public sector is immaterial. It is an Indian carrier. He could not get financial assistance, so he talked to me,” Ravi told reporters here. However, there was no official word immediately on whether any step was being taken on Mallya's request, which he made earlier this week.
Ravi's comments drew sharp criticism from BJP leader and former Finance Minister Yashwant Sinha, who said there was “no case for a government bailout for Kingfisher. We cannot support such a step.”
Congress spokesperson Manish Tewari said it remains to be seen whether in a market economy the government will walk the extra mile to bail out a private company or should allow the shake-out to take place and the fittest to survive”.
