Kingfisher House auction proves to be a flop show; gets no bidders

Auction of the KFA headquarters - Kingfisher House -got over on Thursday without getting any bidders at a base price of Rs 150 crore.

Updated: Mar 17, 2016, 15:43 PM IST
Kingfisher House auction proves to be a flop show; gets no bidders

Zee Media Bureau

New Delhi: Auction of the KFA headquarters - Kingfisher House - got over on Thursday without getting any bidder presumably due to litigation fears and a high reserve price of Rs 150 crore -- dealing a blow to lenders' efforts to recover their loans.

The property, with a built-up area of over 17,000 sq ft in Vile Parle area, was being auctioned by SBICAPS Trustee, a subsidiary of SBI Caps through an e-auction.

The 17-member consortium, which had given loans to Kingfisher Airlines, will soon have a review meeting and may discuss the reserve price as well, sources said.

The online auction was held by SBICAPS Trustee, a subsidiary of SBI Caps.

 

 

Lenders had taken over Kingfisher House in February last year in a bid to recover part of their dues totalling over Rs 9,000 crore, which includes unpaid loans and accrued interest.

The auction, being conducted on e-auction property platform, AuctionTiger, had its base price set at Rs 150 crore.

The auction is being conducted under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (Sarfaesi), 2002.

 

The property was taken over in February 2015 by a consortium of 17 banks lead by State Bank of India in a bid to recover Rs 9,000 crore loan given to the airlines.

Burdened under huge losses and liabilities, including to the lenders, the airline was grounded in late 2012.

While lenders have stepped up their efforts to recover dues totalling over Rs 9,000 crore, the founder and main promoter Mallya left the country earlier this month.

Recently, the Enforcement Directorate registered a money laundering case against Mallya and others based on a CBI FIR registered last year.

 

The agency is also investigating the overall financial structure of Kingfisher Airlines and will look into any payment of kickbacks.

Kingfisher Airlines faces a probe by the Serious Fraud Investigation Office (SFIO) into its allegedly 'inflated' brand valuation of over Rs 4,000 crore.

The government's white-collar fraud detection agency is probing whether such a high valuation was arrived at fraudulently to get more funds from banks and siphon off the additional money for purposes other than proposed investment in the airline.

With Agency Inputs