Business Daily from THE HINDU group of publications
Wednesday, Jun 10, 2009
ePaper | Mobile/PDA Version | Audio | Blogs
Business Daily from THE HINDU group of publications Wednesday, Jun 10, 2009 ePaper | Mobile/PDA Version | Audio | Blogs |
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Airlines Industry & Economy - Foreign Direct Investment Kingfisher Airlines denies exceeding FDI ceiling Our Bureau New Delhi, June 9 Kingfisher Airlines has denied exceeding the foreign direct investment ceiling of 49 per cent which exists in the civil aviation sector. The Finance Ministry is said to have noted deviation in FDI norms from those specified in Press Note II while considering the company’s proposal to raise Rs 708 crore through fully convertible warrants. ‘Divest or compound’The Ministry is believed to have asked the company to either “divest or compound” to ensure that it meets the existing norms. Press Note IIPress Note II, which was issued earlier this year, outlines guidelines for calculating total foreign investment, including both direct and indirect foreign investment in Indian companies. Fund raising specificsPointing out that Press Note II does not apply retrospectively to existing shareholding, a spokesperson for the airline said that the airline is committed to raise equity. “Infusion of fresh capital will have collateral effect of diluting UB Group’s stake. Hence, there is nothing inconsistent with our plans.” The spokesman added that specifics of fund raising will be made known at an appropriate time. Sources indicated that when the airline was established it met the norms laid down by Press Note I which was in force then. However, with the Government notifying new norms for calculating total foreign investment through Press Note II, the company sent its proposal to the Government to raise money through fully convertible warrants. More Stories on : Airlines | Foreign Direct Investment
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