New Delhi/ Mumbai: Ending much speculation, the government on Monday invited bids to sell 100 per cent stake in the hugely loss making Air India. This is the second time that the Centre has issued bids after a failed attempt in 2018.
The last date for submission of bids for Air India will be March 17, 2020.
However, the bid this time has been made more attractive by offering 100% in the national carrier as well as reducing the debt of the company to about Rs 23,286 crore from Rs 62,000 crore.
As part of the strategic disinvestment, Air India would also sell 100 per cent stake in low-cost airline Air India Express and 50 per cent shareholding in joint venture AISATS, as per bid document issued on Monday
Management control of the airline would also be transferred to the successful bidder.
This is the second time in less than two years that the government has come out with proposal for selling stake in Air India, which has been in the red for long.
AISATS is an equal joint venture between Air India and Singapore Airlines. It offers ground handling services. Air India also has interests in Air India Engineering Services, Air India Air Transport Services, Airline Allied Services and Hotel Corporation of India. These entities are in the process of being transferred to a separate company — Air India Assets Holding Ltd (AIAHL) — and would not be a part of the proposed transaction, the document said.
According to the document, debt of Rs 23,286.5 crore would remain with Air India and Air India Express at the time of closing of the disinvestment. The remaining debt would be allocated to AIAHL.
EY is the transaction adviser for Air India disinvestment process.
In 2018, the government proposed to offload 76 per cent equity share capital of the national carrier as well as transfer the management control to private players. However, there were no bidders.
In November 2019, Finance Minister Nirmala Sitharaman had announced that the government planned to wrap up sale of Air India and Bharat Petroleum Corporation Limited (BPCL) by March 2020.
With agency inputs