Posted by: ashishme December 31, 2012
Login in to Rate this Post:
0 
? 
?
Actually more have already followed...Agni Air and Sita air ( probably ) are both on sale as well because the "tycoons" are unable to operate the airlines as they had invested hugely in real estate....so much so that this Basnet guy, who is supposedly a billionaire, cannot even raise Rs 50 million to keep Agni Air running....
KATHMANDU, DEC 05 - The consortium of banks that financed Agni Air has given the cash-strapped carrier until mid-December to pay up or face foreclosure. The banks and Agni Air’s promoters have been scouting around for potential buyers.
The carrier has been grounded for the last three weeks as it has not been able to pay its dues to the Civil Aviation Authority of Nepal (CAAN).
The chief executive officer of one of the banks in the consortium said that the carrier’s promoters had agreed in writing to pay the first instalment and the outstanding interest or quit. A consortium consisting of Grand Bank, Sunrise Bank and International Leasing and Finance Company have lent Rs 650 million to Agni Air.
“As the possibility of loan repayment is slim given the high liabilities of the promoters in different sectors, we are encouraging the sale of the airline’s assets to recover our investment,” said Surendra Man Pradhan, CEO of Sunrise Bank.
Agni Air promoter Sudhir Basnet has huge liabilities in the real estate sector as a majority of his housing projects have not been completed, and the flow of cash has stopped. The airline, which earned a profit in the last fiscal year, was also affected by the promoter’s other liabilities.
According to the lenders, seven parties have shown an interest in purchasing Agni Air including five Nepalis and two foreigners. Among them, Yeti Airlines Domestic and Swift Air Nepal are among the serious contenders to acquire the beleaguered carrier.
The banks said these prospective buyers had offered Rs 550 million to Rs 750 million for the airline. “The promoters, however, are asking for Rs 800 to Rs 900 million,” said bank sources. They added that Agni Air had initially priced its entire property and aircraft at Rs 1 billion. “We are ready to transfer the loans if a good party acquires the airline by paying Rs 200 to Rs 300 million to us,” said a lending bank official.
Last week, there had been intense negotiations for a possible sale of the airline with different parties. “Now, negotiations have been held at the very top level,” said an Agni Air source.
The banks are also conducting a valuation of the airline to facilitate its sale. “The issue will be settled within the next two-three weeks,” said a bank official. As long as the airline remains non-operational, its value will come down. That’s why the banks have been encouraging an early exit of the current promoters.
The airline not only owes huge amounts in bank loans, it has not paid its staff and landing and parking charges to Tribhuvan International Airport.
Three weeks ago, the CAAN suspended the operation of Agni Air for failing to settle outstanding fuel, landing and parking charges. CAAN officials said the airline owes around Rs 2.5 million to Nepal Oil Corporation and around Rs 6 million to CAAN. The airline has not paid salaries worth Rs 10 million to its staff.
Started in 2006, Agni Air owns five aircraft, three Jetstream 41s and two Dorniers. However, only one of the Dorniers is in an airworthy condition.
Agni’s woes began with problems in the real estate sector as its key promoter Basnet is one of the biggest land dealers in the country. A recession in the realty sector stopped Basnet’s cash flow which also affected the airline. Basnet has been blacklisted by the Credit Information Bureau for defaulting bank loans.
Fearing a possible outflow of funds to pay Basnet’s other debts, the banks have made a separate arrangement for repayment of their loans by excluding him from the management team, according to a senior official of a lending bank. As per the arrangement, Agni will have to repay its outstanding loans first from the revenue generated from its operation.
During Agni Air’s good times, it used to fly to eight domestic destinations including mountain flights. In the first half of 2012, it stood third among domestic airlines in terms of passenger carriage.
KATHMANDU, DEC 05 - The consortium of banks that financed Agni Air has given the cash-strapped carrier until mid-December to pay up or face foreclosure. The banks and Agni Air’s promoters have been scouting around for potential buyers.
The carrier has been grounded for the last three weeks as it has not been able to pay its dues to the Civil Aviation Authority of Nepal (CAAN).
The chief executive officer of one of the banks in the consortium said that the carrier’s promoters had agreed in writing to pay the first instalment and the outstanding interest or quit. A consortium consisting of Grand Bank, Sunrise Bank and International Leasing and Finance Company have lent Rs 650 million to Agni Air.
“As the possibility of loan repayment is slim given the high liabilities of the promoters in different sectors, we are encouraging the sale of the airline’s assets to recover our investment,” said Surendra Man Pradhan, CEO of Sunrise Bank.
Agni Air promoter Sudhir Basnet has huge liabilities in the real estate sector as a majority of his housing projects have not been completed, and the flow of cash has stopped. The airline, which earned a profit in the last fiscal year, was also affected by the promoter’s other liabilities.
According to the lenders, seven parties have shown an interest in purchasing Agni Air including five Nepalis and two foreigners. Among them, Yeti Airlines Domestic and Swift Air Nepal are among the serious contenders to acquire the beleaguered carrier.
The banks said these prospective buyers had offered Rs 550 million to Rs 750 million for the airline. “The promoters, however, are asking for Rs 800 to Rs 900 million,” said bank sources. They added that Agni Air had initially priced its entire property and aircraft at Rs 1 billion. “We are ready to transfer the loans if a good party acquires the airline by paying Rs 200 to Rs 300 million to us,” said a lending bank official.
Last week, there had been intense negotiations for a possible sale of the airline with different parties. “Now, negotiations have been held at the very top level,” said an Agni Air source.
The banks are also conducting a valuation of the airline to facilitate its sale. “The issue will be settled within the next two-three weeks,” said a bank official. As long as the airline remains non-operational, its value will come down. That’s why the banks have been encouraging an early exit of the current promoters.
The airline not only owes huge amounts in bank loans, it has not paid its staff and landing and parking charges to Tribhuvan International Airport.
Three weeks ago, the CAAN suspended the operation of Agni Air for failing to settle outstanding fuel, landing and parking charges. CAAN officials said the airline owes around Rs 2.5 million to Nepal Oil Corporation and around Rs 6 million to CAAN. The airline has not paid salaries worth Rs 10 million to its staff.
Started in 2006, Agni Air owns five aircraft, three Jetstream 41s and two Dorniers. However, only one of the Dorniers is in an airworthy condition.
Agni’s woes began with problems in the real estate sector as its key promoter Basnet is one of the biggest land dealers in the country. A recession in the realty sector stopped Basnet’s cash flow which also affected the airline. Basnet has been blacklisted by the Credit Information Bureau for defaulting bank loans.
Fearing a possible outflow of funds to pay Basnet’s other debts, the banks have made a separate arrangement for repayment of their loans by excluding him from the management team, according to a senior official of a lending bank. As per the arrangement, Agni will have to repay its outstanding loans first from the revenue generated from its operation.
During Agni Air’s good times, it used to fly to eight domestic destinations including mountain flights. In the first half of 2012, it stood third among domestic airlines in terms of passenger carriage.