Kingfisher Airlines faces a US$21.6 million (Dh79.3m) court action for overdue aircraft leasing payments.
Creditors of the struggling Indian carrier plan to pursue Kingfisher through its parent company United Breweries.
The Bank of Scotland was understood yesterday to be putting together a court action on behalf of a consortium of lenders to recover the money following a ruling by the High Court in London.
According to court documents, the judge presiding in the case ruled the lenders could proceed against United Breweries, which has been underwriting Kingfisher's operations.
"I am satisfied that the amounts claimed are due and owing and that therefore in those circumstances the claimants are entitled to summary judgement in the sum claimed, that is US$21,589,972.56 [and that] no other good reason [had been presented as to why the case should not proceed to trial]," said Mr Justice Bernard Eder.
The judgement paves the way for an action in India, or the UK, to allow Bank of Scotland to pursue United Breweries' assets to recover the outstanding sum.
The aircraft leased to Kingfisher, 10 ATR turbo-prop airliners, had been bought by a syndicate through KF Turbo Leasing, a special-purpose company incorporated in the Cayman Islands, to lease the aircraft to Kingfisher under a 10-year contract in 2007.
However a spokesman for the bank would only say it was "not in a position to make any comment, as our banking relationships with our customers are confidential".
The news came after Kingfisher cancelled nearly a fifth of its flights on Monday, including one between New Delhi and Dubai, and at least four yesterday, after more than a dozen pilots refused to turn up for duty because they had not been paid.
Hopes of a bank bailout were also dashed, when Namo Narain Meena, the Indian government's junior minister of finance, delivered a written reply to parliamentary questions, ruling out any additional loans by the State Bank of India to Kingfisher. The state-run bank is the biggest lender to the cash-strapped airline, with a total debt exposure of 14bn rupees (Dh1.03bn). It also holds a 5.7 per cent stake in the airline, acquired after the conversion of other loans last year.
Yesterday, as Kingfisher flights continued to be cancelled, Vijay Mallya, the chairman of the airline, who also owns United Breweries, described the flight disruptions as "planned cancellations".
"We spoke to our pilots. We are sorting it out," Mr Mallya said, speaking outside the Indian parliament. "We are facing a serious handicap as our accounts are frozen. We are not asking for bailout from the government, but hope for help from [the] banking sector to de-freeze our accounts."
Last month, Kingfisher was forced to file a new timetable to India's aviation regulator, the director general of civil aviation, cutting daily flights by almost two thirds to 175, and its available aircraft from 64 to 28.
Kingfisher said its schedule was also affected after the company was suspended last week by the International Air Transport Association (IATA) from its global payments system.
The suspension effectively cut off Kingfisher from a vast network of travel agencies that book tickets online with payments cleared through IATA.
Kingfisher, which has never turned a profit and has sunk deeper into debt since its launch in 2005, has run a reduced flight schedule in recent weeks amid growing fears for its survival.
Mr Mallya has said the airline needed $200m to $250m immediately to secure its future.
Its net loss widened sharply to 4.44bn rupees (Dh326.6m) in the three months to December from a loss of 2.54bn rupees a year earlier, while its debt totals at least $1.3bn.
dblack@thenational.ae
THE SPECS
Engine: 1.5-litre turbocharged four-cylinder
Transmission: Constant Variable (CVT)
Power: 141bhp
Torque: 250Nm
Price: Dh64,500
On sale: Now
A timeline of the Historical Dictionary of the Arabic Language
- 2018: Formal work begins
- November 2021: First 17 volumes launched
- November 2022: Additional 19 volumes released
- October 2023: Another 31 volumes released
- November 2024: All 127 volumes completed
Ticket prices
- Golden circle - Dh995
- Floor Standing - Dh495
- Lower Bowl Platinum - Dh95
- Lower Bowl premium - Dh795
- Lower Bowl Plus - Dh695
- Lower Bowl Standard- Dh595
- Upper Bowl Premium - Dh395
- Upper Bowl standard - Dh295
Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
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%3Cp%3ECompany%20name%3A%20Shipsy%3Cbr%3EYear%20of%20inception%3A%202015%3Cbr%3EFounders%3A%20Soham%20Chokshi%2C%20Dhruv%20Agrawal%2C%20Harsh%20Kumar%20and%20Himanshu%20Gupta%3Cbr%3EBased%3A%20India%2C%20UAE%20and%20Indonesia%3Cbr%3ESector%3A%20logistics%3Cbr%3ESize%3A%20more%20than%20350%20employees%3Cbr%3EFunding%20received%20so%20far%3A%20%2431%20million%20in%20series%20A%20and%20B%20rounds%3Cbr%3EInvestors%3A%20Info%20Edge%2C%20Sequoia%20Capital%E2%80%99s%20Surge%2C%20A91%20Partners%20and%20Z3%20Partners%3C%2Fp%3E%0A
What is double taxation?
- Americans living abroad file taxes with the Internal Revenue Service, which can cost hundreds of dollars to complete even though about 60 per cent do not owe taxes, according to the Taxpayer Advocate Service
- Those obligations apply to millions of Americans residing overseas – estimates range from 3.9 million to 5.5 million – including so-called "accidental Americans" who are unaware they hold dual citizenship
- The double taxation policy has been a contentious issue for decades, with many overseas Americans feeling that it punishes them for pursuing opportunities abroad
- Unlike most countries, the US follows a citizenship-based taxation system, meaning that Americans must file taxes annually, even if they do not earn any income in the US.
The lowdown
Badla
Rating: 2.5/5
Produced by: Red Chillies, Azure Entertainment
Director: Sujoy Ghosh
Cast: Amitabh Bachchan, Taapsee Pannu, Amrita Singh, Tony Luke
How it works
Booklava works on a subscription model. On signing up you receive a free book as part of a 30-day-trial period, after which you pay US$9.99 (Dh36.70) per month to gain access to a library of books and discounts of up to 30 per cent on selected titles. You can cancel your subscription at any time. For more details go to www.booklava.com
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
When Umm Kulthum performed in Abu Dhabi
Known as The Lady of Arabic Song, Umm Kulthum performed in Abu Dhabi on November 28, 1971, as part of celebrations for the fifth anniversary of the accession of Sheikh Zayed bin Sultan Al Nahyan as Ruler of Abu Dhabi. A concert hall was constructed for the event on land that is now Al Nahyan Stadium, behind Al Wahda Mall. The audience were treated to many of Kulthum's most well-known songs as part of the sold-out show, including Aghadan Alqak and Enta Omri.
UAE currency: the story behind the money in your pockets
Our Time Has Come
Alyssa Ayres, Oxford University Press
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Quick facts on cancer
- Cancer is the second-leading cause of death worldwide, after cardiovascular diseases
- About one in five men and one in six women will develop cancer in their lifetime
- By 2040, global cancer cases are on track to reach 30 million
- 70 per cent of cancer deaths occur in low and middle-income countries
- This rate is expected to increase to 75 per cent by 2030
- At least one third of common cancers are preventable
- Genetic mutations play a role in 5 per cent to 10 per cent of cancers
- Up to 3.7 million lives could be saved annually by implementing the right health
strategies
- The total annual economic cost of cancer is $1.16 trillion
COMPANY%20PROFILE
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How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
What to watch out for:
Algae, waste coffee grounds and orange peels will be used in the pavilion's walls and gangways
The hulls of three ships will be used for the roof
The hulls will painted to make the largest Italian tricolour in the country’s history
Several pillars more than 20 metres high will support the structure
Roughly 15 tonnes of steel will be used
TO A LAND UNKNOWN
Director: Mahdi Fleifel
Starring: Mahmoud Bakri, Aram Sabbah, Mohammad Alsurafa
Rating: 4.5/5
The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
The specs
Engine: Four electric motors, one at each wheel
Power: 579hp
Torque: 859Nm
Transmission: Single-speed automatic
Price: From Dh825,900
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WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
The specs
Engine: 1.5-litre 4-cylinder petrol
Power: 154bhp
Torque: 250Nm
Transmission: 7-speed automatic with 8-speed sports option
Price: From Dh79,600
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