Cox & Kings share price falls 5% on sale of corporate travel business to Ebix Software

Cox & Kings falls 5% on sale of corporate travel business to Ebix Software

Cox and Kings share price fell in trade today on news that the travel firm has sold its corporate travel business to Ebix Software India. Cox and Kings share price was locked in the lower circuit of 5% at Rs 3.86 against the previous close of Rs 4.06 on BSE. Cox and Kings share price opened marginally higher at Rs 4.24 but fell subsequently due to the negative development.  There were only sellers, no buyers in the stock.

The stock hit its 52-week high on October 31, 2018 and 52-week low on September 11 this year. The travel firm in a filing said, “The Company has signed a term sheet with Ebix Software India Pvt Ltd (‘Ebix’), whereby the Corporate clients (formerly serviced & prospective) of the Business Travel Unit of the Company are to be introduced to Ebix. Some staff servicing these corporate clients will be absorbed by Ebix. Due to the termination of the IATA licence for Air ticket issuances, the Business Travel Unit of the Company could not service its Corporate clients.”

Cox & Kings has defaulted on multiple payments of commercial papers since June 2019, when the first default of Rs 150 crore was announced. As per the company latest regulatory filing, the company has defaulted on payments worth Rs 30 crore on September 20.

With the ongoing crisis, Cox and Kings, has got a 180-day limit from lenders to finalise a resolution plan. “We propose to meet the company’s financial obligations through a combination of internal accruals and monetization of assets, we are in the process of evaluating the potential of every business to generate cash flows” the regulatory statement read.

In another BSE filing, the Indian tours and travel company announced that the International Air Transport Association (IATA) has terminated its licence for selling tickets and asked the company to surrender its IATA ID Card. Company has requested authorities to re-instate its licence against clearance of dues. Cox & Kings is around US$500 million in debt. Headquartered in Mumbai, Cox and Kings has offices all around the country and employs over 5,000 people.

[“source=businesstoday”]