The State Bank of India (SBI) has signalled that it may seize the headquarters of grounded carrier Kingfisher Airlines as it works to recover debts owed by the carrier.
A source from the airline confirmed, in response to Flightglobal Pro's enquiries, that the SBI has placed a notice on the airline's headquarters in Mumbai, Kingfisher House, stating its interest in the property.
The source adds, however, that the bank has not yet formally moved to seize the property and that its staff continue to work in the building unimpeded. He also suggested that the airline will examine legal options to prevent the bank taking control of the property.
SBI is the lead lender in a consortium of banks that are reportedly owed Indian rupees (Rs) 70 billion ($1.14 billion) by Kingfisher, which was grounded by the Director General of Civil Aviation (DGCA) in October last year following concerns that the airline's parlous financial state was affecting the safety of its operations.
Reports indicate that the SBI and other banks have also been moving to take control of shares in other companies owned by Kingfisher's main shareholder, UB Group, to recoup their debts. The banks may also move to seize other properties owned by UB Group and chairman Vijay Mallya that were put up as security for the loan.
Kingfisher maintains that it continues to work with the DGCA on a plan to return to operations, but previous restart plans were rejected for being too vague about the airline's financial situation.