Reliance denies Kingfisher stake-buy talks report

Thursday, 17 November 2011 00:00 - - {{hitsCtrl.values.hits}}

MUMBAI, (Reuters): A spokesman for Reliance Industries denied on Wednesday a newspaper report the Indian energy major was in talks to buy a stake in cash-strapped Kingfisher Airlines.

The Business Line newspaper had reported that Reliance might make a financial investment or pick up a stake through a preferential offer by the carrier, which could be followed up by an open offer to public shareholders.

Citing an unnamed person close to the airline, the paper said Reliance was understood to have engaged a merchant banker to carry out due diligence of the carrier.

Ravi Nedungadi, chief financial officer of UB Group, the airline’s parent, had said on Tuesday it had been approached by strategic investors.

An official with one of Kingfisher’s lenders had also said the carrier’s chairman, Vijay Mallya, was talking to a potential strategic investor.

Kingfisher, which reported a September quarter loss of 4.69 billion rupees ($92 million) on Tuesday, cancelled scores of flights last week as it abruptly shut some routes. It has also been late paying salaries. ($1 = 50.9 rupees)