“Representatives from these companies have met government officials and, unofficially, shown interest in the national carrier. The Tata Group, however, has not shown any interest yet,” said the official, who sought anonymity.
The government, which could not sell 76% in Air India last year, is offering 100% stake this time. But the response to road shows in Singapore and London were not encouraging.
Officials said that they did, however, see interest from a couple of private equity investors. “There are these two companies and a couple of private equity investors who have shown some interest. An airline as big as Air India is unlikely to receive any more interest,” said the official.
The Centre is likely to come up with the expression of interest (EoI) documents by next month.
Among the two suitors, IndiGo can bid to own 100% in Air India but Etihad can own only 49% under the current foreign direct investment (FDI) norms.
The norms allow a foreign carrier to own up to 49% in an Indian airline, but allow 100% foreign investment in an airline. This means Etihad can bid for 100% stake in Air India by tying up with either Abu Dhabi Investment Authority (ADIA) or National Investment and Infrastructure Fund.
The National Investment and Infrastructure Fund is an infrastructure investment company anchored by the Indian government, where ADIA is a key investor.
Etihad, till recently, owned 24% in
Emailed questionnaires sent to IndiGo and Etihad had not elicited any response as of press time Monday.
The government, which did not receive a single bid in its maiden attempt to sell Air India last year, is being cautious this time and has offered various relaxations, such as 100% stake in the airline, substantial restructuring of debt and liabilities and allowing the new owner to offer VRS to employees.
According to the plan being discussed, the government will pay Air India’s dues amounting to Rs 22,000 crore to vendors such as airports and oil companies before putting the airline up for sale. It may also waive the airline’s entire working capital debt of about Rs 15,500 crore, so that Air India is left with a loan burden of about Rs 20,000 crore.
According to the approved plan, Air India will be offered along with low-cost international subsidiary Air India Express as well as its 50% stake in ground-handling company Air India Singapore Airport Terminal Services.
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13 Comments on this Story
Binit Ambastha424 days ago
If GOI is ready to pay all the due for Air India then why they are not operating the airlines. They should allow Airlines to start operating and airlines should not give any freebie to any of the govt officials and should operate on cost margin basis.
Ban Bollywood Movies425 days ago
It should be signed by the buyer on a stamp paper inside Supreme Court that Govt. of India will not be approached for money in any case in future.
Ban Bollywood Movies425 days ago
Anything can be called India-this or India-that or crown jewel etc. Huge resources as thousands of crores are spent on these. After selling the airline change the name so that the CEO dont come to the Govt with a begging bowl every now and then. Also the babus dont misuse tax payers money by using it and to pay later.