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Prospective bidders had earlier termed the reserve price as too high, while multiple legal woes of Mallya-led UB Group are also being cited by many as reasons for lack of interest in buying this property
The auction of Kingfisher House proved a damp squib yet again, on Thursday, as no bidder turned up for the erstwhile headquarters of Vijay Mallya-led group's long-grounded airline at a reduced reserve price of Rs 135 crore (Rs 1.35 billion).
Bankers said they may have to further lower the reserve price -- which was set at Rs 150 crore (Rs 1.5 billion) in the earlier failed auction in March -- to get any prospective buyer interested for the prime property near domestic airport in Mumbai.
The 17-bank consortium, led by State Bank of India, have been trying to sell this property as part of their efforts to recover dues totalling over Rs 9,000 crore (Rs 90 billion) from Kingfisher Airlines and had reduced the the reserve price by 10 per cent for today's auction.
The auction of Kingfisher House, has a built-up area of over 17,000 sq ft and is located in the plush Vile Parle area, started at 1100 hrs and lasted for an hour without a single bidder coming forward.
"There were no bids for Kingfisher House. Even this (reserve price) Rs 135 crore was high for bidders," a source said, adding the price would need to be brought down further.
Prospective bidders also had earlier termed the reserve price as too high, while multiple legal woes of Mallya-led UB Group are also being cited by many as reasons for lack of interest in buying this property.
Mallya, who has been declared by some banks as wilful defaulter, had left the country in March and is currently said to be in the UK.
Kingfisher House is just one of the several properties, together worth over Rs 700 crore (Rs 7 billion) that lenders and the tax department will put under hammer this month to recover part of their dues totalling thousands of crores of rupees.
Mallya's luxurious personal jet along with everything inside that include cushy couches and even a bathrobe will be auctioned by the service tax department on August 18.
Besides Kingfisher House, lenders have also separately put up for sale some of the movable secured assets worth Rs 13.70 lakh lying at this office property.
The items on sale would include eight cars, Toyota Innova, Honda City, Honda Civic and Toyota Corolla, among others. The reserve price of each car has been set differently in the range of Rs 90,000-2.50 lakh.
These assets will be auctioned separately on August 25.
On the same day, banks will also re-auction brands and trademarks of the airlines including the Kingfisher logo as also the once-famous tagline 'Fly the Good Times'.
The reserve price for auction of brands and trademarks has been reduced to Rs 330.03 crore (Rs 3.3 billion) from Rs 366.70 crore (Rs 3.67 billion).
In its heydays, the Kingfisher brand itself was valued at over Rs 4,000 crore (Rs 40 billion) by Grant Thornton. The airline's brand was registered separately from the Kingfisher beer trademarks.
Banks will also soon auction Kingfisher Villa in Goa. The valuation process is underway for the Villa could be around Rs 90 crore (Rs 900 million).
Image used for representation purpose only
Photograph: Reuters