No communication from lenders on loan recovery: UB Group
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The UB Group, which has been facing heat from its lenders, on Friday said that efforts are on to find an "early solution". This statement from the UB Group comes two days after the lenders to Kingfisher Airlines said they will commence the process of recalling the Rs 7,500 crore loan to Kingfisher Airlines.
"We have received no formal communication from the banks till date (on the recall). We are in continuing discussions with them on ways to bring down their exposure, interalia, from the proceeds of the Diageo transaction... The banks explicitly support the transaction with Diageo and would work with us in finding an orderly method of disposal of some of the pledged shares to Diageo if appropriate," UB Group said in a statement.
However, the the statement offered no explanation on how the proceeds from the deal with Diageo will be routed to the lenders of Kingfisher Airlines.
Of the Rs 5,600 crore that Diageo is to pay out to UB Group companies — United Spirits and UB Holdings — Rs 3,200 crore will be going into United Spirits to be used for its own debt reduction and operations. The rest Rs 2,400 crore will be going to UB Holdings, which is be using to pay back its lenders and release the pledged shares so that they can be transferred to Diageo.
With this in view, it is unclear how UB Group will use the proceeds from the Diageo deal to settle with the lender of Kingfisher Airlines.
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