Deal money not for KF

Vijay Mallya, chairman of the UB group, clarified on Friday that the Rs 11,166 crore he would get from the UK-based Diageo plc for the sale of 53.4 per cent stake in United Spirits Limited would not be used to bail out the cash strapped Kingfisher Airlines. In a conference call with journalists on Friday evening he said “United Breweries (Holding) Ltd has multiple businesses and each is independent of the other. There is no cross contamination,” he said adding that “this is the best deal for my spirits business and I will address the Kingfisher issue separately.”
Mallya was asked repeatedly about whether any of the money will be utilised for Kingfisher Airlines. He said “I do what is best for each business. Earlier I did it for the beer business and now I am doing it for the spirits business. Kingfisher will be addressed squarely and fairly and these are all mutually exclusive.”
The State Bank of India had asked Mallya to bring in $1 billion (`5,400 crore) by November 30. SBI chairman Pratip Chaudhuri had on the sidelines of the World Economic Forum in New Delhi this week told reporters “We have said please attend to the capital needs urgently and we would like to see some tangible progress at least by November 30.”
He said that they had not put a gun to his head but said that it would be a good starting point to get this money. SBI has given Kingfisher loans of Rs 7,000 crore and they have repor-tedly become non-performing assets. The cash strapped airline has also made a loss of Rs 8,000 crore.
When asked about how he would resolve this issue of bringing $1 billion by November 30, Mallya said, “I am not aware of any deadline given by bankers. I have a comprehensive rehabilitation plan and a re-capitalisation plan for Kingfisher. It is unfortunate to link this transaction (with Diageo) which will boost the interest of the US company and the shareholders with the Kingfisher issue.” He added at the end of the concall, “Just celebrate this deal with us today.”



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