Bangalore: The chairman of Bangalore based Kingfisher Airlines, Vijay Mallya has said in an interview with a news paper that he was close to sealing a USD 370 million deal with an Indian private investor and a consortium of banks that would save the airline.

He further said that he was nearing a deal with 14 banks led by State Bank of India that would provide the loss-making carrier with working capital of 6 billion rupees (USD 118 million). He did not name the banks.
Earlier this week, Kingfisher said its net loss for the September quarter doubled but Mallya offered little to revive its finances. It had also said it had been approached by strategic investors.

Mallya, a flamboyant liquor baron who owns a Formula One motor-racing team, told the paper he was finalising a separate USD 250 million equity injection from an unnamed wealthy Indian individual to recapitalise the cash-strapped carrier.

He added that he was about to conclude a deal with the banks to reduce the interest rate which the airline is currently paying on its USD 1.4 billion debt pile.

Mallya said on the social networking site Twitter that the report was "factually wrong", but he did not elaborate.

Shares in Kingfisher, which is named after its parent firm's best-selling beer were down more than 5 percent in early trade on Friday in Mumbai.

Kingfisher which listed when it bought out budget airline, Air Deccan in 2008, has never made a profit and its market value has plunged 64 percent this year.

The airline became India's No  2 private carrier since it began operations in 2005 as the economy boomed but it has become one of the main casualties of high fuel costs and a fierce price war between a handful of airlines which, between them have ordered hundreds of aircraft for delivery over the next decade in an ambitious bet on the future.

(Agencies)