Liquor baron Vijay Mallya, who owns the crisis-ridden Kingfisher Airlines, on Monday said he had organised funds to pay “seriously overdue salaries” to the employees.
Though he did not give any details about the funding, Mr. Mallya said the airline promoters had converted their loans for an additional 5 per cent equity last week.
In an internal letter to the employees, he also came out heavily against “Indian” and “paid media” for their reports on the cash-strapped carrier. “The Indian media and the ‘paid' media, that even the Prime Minister referred to are unscrupulous, will do whatever it takes, part fact or fiction, part true or untrue, to achieve their sensationalist objectives,” he said while referring to the “media frenzy'' on the recent developments in the airlines.
“I have organised funding so that we can pay your seriously overdue salaries which is a source of great personal sorrow for me. We are currently handicapped as our bank accounts are frozen by the tax authorities.”
“I have been working tirelessly to urgently resolve this issue through negotiation and I hope that these efforts will be successful early next week. We fully intend to pay our tax dues as much as we commit to paying your salaries,” he said.
According to latest figures, Kingfisher suffered a loss of Rs. 1,027 crore in 2010-11 and has a debt of Rs. 7,057.08 crore. Struggling with fewer flights, unpaid salaries and outstanding dues to oil companies, it has posted a Rs. 444 crore loss for the third quarter.
Mr. Mallya said Kingfisher promoters, the UB Group and its associates, have converted its loans for an additional 5 per cent equity in the airlines last week. “This is the maximum permitted under law in one financial year, but clearly demonstrates the faith that I have in all of you and in our company.”
He admitted that a large number of employees had left and many were about to quit the airline.
Noting that government policies could “make or break any industry,” Mr. Mallya said, “so far it has been downhill for Civil Aviation except for one airline that defies the odds and claims to be profitable however unlikely that may be.”
‘Test of loyalty'
He said the Kingfisher family would grow “with those who have the pride in their hearts of having stood by our company through ups and downs, sometimes with great personal sacrifice. That is the true test of loyalty dedication and commitment.”