Auction of brands and trademarks of Kingfisher Airlines turned out to be a damp affair as lenders failed to attract a single bidder for the sale of these pledged assets at a reserve price of Rs 366.70 crore on Saturday.
The auction was being conducted to recover unpaid loans from the beleaguered Vijay Mallya.
This is the second failed attempt by the 17-bank consortium led by the state-run SBI to recover some money from Mallya.
An auction held earlier of the Kingfisher House – the erstwhile headquarters of the long-defunct airline met with a similar fate, with no bidder coming forward at a reserve price of Rs 150 crore.
The items on sale during Saturday’s e-auction included the Kingfisher logo as also the once-famous tagline ‘Fly the Good Times’. The other trademarks on sale included Flying Models, Funliner, Fly Kingfisher and Flying Bird Device.
The reserve price for the trademarks was kept at Rs 366.70 crore, which is not even one-tenth of the price at which it was pledged as a collateral for the loan. Sources, however, said the reserve price was “too high” for any bidder to come in.
A banking source said:
There were no bids, possibly because the reserve price was considered very high. Though the reserve price was set much lower than its original valuation at the time of taking the brand as collateral, people still found it to be high.
The online auction began at 11:30 am and lasted for an hour without any success. It was conducted by SBICAP Trustee Company on behalf of lenders under the Sarfaesi Act.
The Kingfisher brand itself was valued at over Rs 4,000 crore by Grant Thornton when the airline was at its peak. In its annual report for 2012-13, KFA said that at its peak, it was the largest airline in India, with a five-star rating from Skytrax.
The airline’s brand had been registered separately from the Kingfisher beer trademarks. A senior banker said:
The interest for this auction could have been from existing airline operators, but no one will come. It is better to start a new airline company than to buy this brand and revive it.
Sources said the lenders might now try to lower the reserve price in both the cases in their future efforts to sell these pledged assets.
(With inputs from PTI.)
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