New Delhi: The board of national carrier Air India approved the proposal of issuing preferential shares worth Rs 7,500 crore to the airlines’ lenders as a part of its financial restructuring plan (FRP).

“The decision to this effect has been taken as a part of the financial structuring plan. However, we are currently working on Cabinet note for raising equity and FRP. This will be sent to Ministry of Civil Aviation for its final nod soon,” AI spokesperson told reporters after the board meeting here on Thursday.

Sources said important issues including financial restructuring plan and review of Directors’ reports for the period 2010-2011 were discussed during the meeting.

Notably, Air India witnessed 10 percent increase in the revenue in November as compared to last year’s performance during the same period. Besides this, its passenger revenue rose 12.3 per cent in November, compared with the year-ago period.

The Air India presently owes an outstanding debt of Rs 7, 500 crore to 14 banks including the State Bank of India (SBI).

It is noteworthy that the SBI has sought the aid of the Central bank to increase the repayment duration of Air India by five years. However, the RBI’s decision to this effect is awaited.