As Wednesday was the last day for putting in the financial bid to buy Air India, the Department of Investment and Public Asset Management is taking the process to the next stage. Tata sons, SpiceJet chairman Ajay Singh are among the bidders, reports confirmed.
“Financial bids for Air India disinvestment received by Transaction Adviser. Process now moves to concluding stage,” the secretary, Department of Investment and Public Asset Management, said on Twitter.
The Centre has been trying to find a buyer for Air India and earlier the government was up for selling a 76% stake. Now, the Centre is selling 100% stake of Air India.
The process started in January 2020 got derailed because of the pandemic and this time, the ministry was firm to not postpone the last date of bidding. Tata Group was among the multiple entities that had put in an initial expression of interest in December 2020 for buying Air India.
As of March 1, 2019, Air India’s total debt was ₹60,074 crore. The debt will be transferred to its new owner but the government made it easy for the new owner by inserting a flexibility clause. Going by the new clause, the new owner of Air India will have to absorb ₹23,286.5 crore while the rest would be transferred to Air India Assets Holding Ltd, a special purpose vehicle.
This clause was brought in to make the deal sweet for the prospective buyer as Air India has been in losses since 2007.
The airline, which was formed by the Tatas as a mail carrier in 1932, will give the successful bidder control of 4,400 domestic and 1,800 international landing and parking slots at domestic airports, as well as 900 slots at airports overseas. Besides, the bidder would get 100 per cent of the low-cost arm Air India Express and 50 per cent of AISATS, which provides cargo and ground handling services at major Indian airports.
