Kingfisher Airlines of India, which is laden with debt, reached closer to the verge of collapse on Tuesday after there were huge number of flight cancellations for almost a week and the resignation of many pilots.
One of the major stakeholders in Kingfisher is Vijay Mallya, who is a flamboyant alcohol businessman. Mallya holds majority of the stake in Kingfisher and said that he was focused to keep the airlines in operation and also cited tax authorities as the cause of debt crisis which the airlines is going through. Vijay pointed that the tax authorities have frozen the airline’s bank account over outstanding dues.
Talking to reporters, Mallya said that he is committed to maintain the operations of the airlines unless any government operated agency wishes to stop its operations. Adding further, the liquor baron said that the point is that income tax authorities have frozen their bank accounts suddenly which has crippled them.
During early trading on Tuesday, shares of Kingfisher plunged by almost 20 percent, before the meeting between the country’s aviation regulator and the top executives of the airlines.
Kingfisher has 64 planes in its fleet but the company is using a little over 12 to operate flights currently, deserting thousands of passengers at different airports throughout India.
Vijay Mallya, who is 56 years of age, is also the chairperson of United Breweries, which is a conglomerate with diverse interests including biotechnology, breweries, aviation, real estate and others. The group has yearly sales of more than 4 billion dollars.
As a businessman, Mallya is a known name but his airline’s brand, which takes its name from the famous Indian beer, Kingfisher, has been a victim of increased cost of fuel and a tight price war between a limited numbers of budget carriers.
