and some shares of McDowell Holdings pledged with it by the promoters to recover overdue loans from debt-laden Kingfisher Airlines, according to two people familiar with the matter.
J&K Bank, which has an exposure of Rs 100 crore, has recovered about Rs 70 crore from the sale of shares already. The share sale began in end-2012.
“Shares were sold in small segments over 2-3 months. Now the exposure is about Rs 30 crore,” said a person, who did not wish to the identified.
Vijay Mallya’s Kingfisher Airlines has repeatedly failed to get fresh capital from investors and has also been unable to restart the grounded airline.
Led by State Bank of India, the 14-bank consortium, which has an exposure of about Rs 7,000 crore, has also started the recovery process by partly selling the pledged shares of United Spirits two weeks back. The consortium has so far sold 7.3 lakh shares of the total 26 lakh shares pledged.
United Breweries, promoter to the cash-strapped airline, had moved the court to stop the sale of United Spirits shares by the consortium, claiming that the the sale could hamper the USL-Diageo deal and harm shareholder interest. However, the court refused to stop the share sale. The consortium was represented by law firm Dua Associates, while UB was represented by Bachubhai Munim & Co.
J&K Bank, Oriental Bank of Commerce and Srei Infrastructure, which are not part of the consortium, have a total exposure of more than Rs 550 crore to Kingfisher Airlines.
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