United Breweries says no to Kingfisher airline brand

MUMBAI: United Breweries, a likely candidate to buy the Kingfisher airline brand, says it is not interested in owning the carrier's label.
"United Breweries owns the Kingfisher beer and water brands, and the airline brand holds no relevance to us," said the company's managing director Shekhar Ramamurthy. The local brewer's Dutch promoter Heineken too has said that it is not interested in buying the Kingfisher airline brand.
Lenders to Kingfisher Airlines, grounded since October 2012, are looking to recover dues worth Rs 9,000 crore through sale of its assets, including the carrier's brand.
Companies prefer to own the rights to the flagship brand across categories even if they don't have a presence in certain business segments. This is done to protect the trademark from being used by other players. Among Indian conglomerates, parent brands such as Tata, Godrej and Larsen & Toubro are registered in a host of business areas.
The Kingfisher airline brand is worth much less today compared to its peak time valuation of Rs 4,100 crore as estimated by Grant Thornton, said brand consultants.
This is because the valuation of the brand is linked to its revenue generation. With Kingfisher Airlines no longer in the business, the brand's valuation has taken a beating. Vijay Mallya, the flamboyant promoter of the airline, had named the carrier after the Kingfisher beer brand to promote the drinks business.
"Most of the intrinsic value of the Kingfisher brand lies in the beer business. The last public report lists its worth over Rs 11,000 crore. So, it is a very attractive brand to buy as Kingfisher. However, the Kingfisher airline brand, under its registration, can only be used for the aviation business. Its credibility has taken a huge hit. You certainly cannot recover much money from it," said Ramesh Jude Thomas, president, Equitor Value Advisory, a brand consultancy outfit.
Mallya had pledged the Kingfisher airline brand as collateral to banks against loans, a practice followed globally. In the past, Walt Disney, Calvin Klein and Daawat brands had been leveraged to raise funds.
With United Breweries not interested in the Kingfisher airline brand, a player from the aviation segment could look at it. "The Kingfisher airline brand can be revived provided it has a new owner with high standing and experience in the air travel space," said Thomas, adding "When it was flying, it had a very decent following and a market share to match."