IDBI Bank-led consortium raises $1.1 b loan for Air India

IDBI Bank-led consortium raises $1.1 b loan for Air India

Last Updated: Tue, Aug 18, 2009 03:00 hrs

IDBI Bank-led consortium of lenders have raised $1.1-billion loan for national carrier Air India to purchase aircraft, a top IDBI Bank official said.
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IDBI Bank acted as the lead arranger for the syndication along with 12 lenders from the domestic market, IDBI Bank's Corporate Banking Group Head, B.K. Batra, told PTI.

"We have tied-up with 12 banks to arrange the $1.1 billion loan. This will be used by the airline to buy aircraft," Batra said.

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Among the banks, who participated in the consortium, are India's second largest state-owned lender, Punjab National Bank, Canara Bank and Central Bank of India, the official said.

The airline intends to use the loan amount to purchase 12 out of the 43 aircraft it plans to acquire, including A-319, A-320 and A-321.

Though Batra declined to divulge further details, it is understood that the loan amount has been equally divided among the lenders in the consortium with a view to reduce the burden on individual banks.

IDBI Bank had recently extended a Rs 300-crore loan to the beleaguered Satyam Computer, helping the IT-firm's newly appointed board to fulfill its short-term requirements.

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