Govt to sell 76% stake in Air India, invites expression of interest

Henrietta Strickland
March 28, 2018

For the goal Government has gone ahead with the advertisement calling out bids for sale of 76 per cent stake in the national carrier Air India, which owns 100 per cent stake in low-priced global subsidiary Air India Express. The government has proposed strategic divestment of the airline by transferring management control and 76 per cent equity share it holds.

In its last leg of disinvesting state-owned airlines, Central government on Wednesday approved the Air India disinvestment plan.

As per the over 200-page-long document, the Centre proposes to carry out the the strategic disinvestment of AI by transferring management control and selling its 76 per cent equity share capital in the airline. In turn the airline has a cent per cent stake in Air India Express, while it holds 50 per cent stake in the joint venture AISATS. The balance debt will be allocated to a government holding company. As of now, Air India has a total debt of Rs 52,000 crore to its name, out of which, Rs 33,000 crore is due to working capital loans. "Details of this debt or liabilities reallocation shall be shared at RFP (request for proposal) stage", the document said.

According to statement, The Centre has sought a minimum net worth of Rs 5,000 crore for Air India bidders.

Another hoax threat incident was reported in August previous year, after a Delhi-bound AI flight from Jodhpur was delayed upto three hours after the authorities were alarmed by a miscreant called for a bomb being planted in the aircraft.

During this period, the bidder would also not be allowed to cede the management control.

The complete information related to the process has been communicated to the prospective bidders.

Air India management or employees can participate in the bidding process either directly, or by way of forming a consortium, as per the memorandum.

In his Budget speech for 2018-19, Finance Minister Arun Jaitley had said: "The government has also initiated the process of strategic disinvestment in 24 Central Public Sector Enterprises".

AASL is the regional arm of Air India and flies to Tier II and III cities.

Other reports by Click Lancashire

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