India renews attempt to invite bids for 100% Air India stake

Date: 2020-01-28   Author: Pankaj Singh  Category: #news

India renews attempt to invite bids for 100% Air India stake

The Government of India has recently announced a plan to sell its entire stake of Air India Limited, renewing its attempt to put the state-owned airline on the block. This is the second attempt by the Indian Government to sell majority stake in the loss-generating airline, after a similar move failed to attract any bidder in 2018.

It has recently come to light that March 17th has been set as the deadline for submitting the initial EOI (expressions of interest). Any bidder must comply to the terms of the contract, including assuming nearly $3.28 billion in debt. In addition, the government has retained a provision that Air India’s control must remain with an Indian entity for effective management and ownership.

Kapil Kaul, aviation consultancy head of CAPA India, stated that the accumulated debt of Air India put the financial position in fragile condition. However, private investors can turn this around, and bring in operational and financial efficiencies by providing the required capital. This can help the government use taxpayers’ funds in fulfilling social agendas.

Hinduja Group and Interups (ITUP) are reportedly interested in the bidding. Laxmi Prasad (Interups’ chief business architect and chairman) also initiated discussions with government officials to negotiate on the airline’s other business aspects that can be included in the deal.

According to civil aviation minister, Hardeep Singh Puri, the government is open to revise, refine, and modify views, for alterations or modification of some provisions if it could help find bidders.

A successful bidder would get control of Air India’s 1,800 international and 4,400 domestic landing and parking slots in domestic airports, as well as 900 slots at overseas airports. They will also receive 100% of the low-cost arm of Air India and 50% of AISATS. The buyer will be required to provide 3% equity value as stock options for permanent Indian employees.

Jet Airways Ltd., Indigo, and Tata Group initially showed interest, but later withdrew from the deal after the disclosure of terms and conditions that seemed to be too onerous. It is also likely to face opposition from Subramanian Swamy, BJP’s MP, who is reportedly threatening to initiate legal action against the deal.

Source credit:

About Author

Pankaj Singh linkdin-boxtwitter

Pankaj Singh

Pankaj Singh Develops content for Algosonline, Market Size Forecasters, and a couple of other platforms. A Post Graduate in Management by qualification, he worked as an underwriter in the UK insurance domain before deciding to switch his field of profession. With exp...

Read More

Post Recommendents

UV Curable Resins Market Trends, Forecast and Competitive Analysis Report 2021-2026

Author: Rahul Varpe

Learn how to build the strategy and business case to implement. UV Curable Resins market size (value and volume) by players, regions, product types and end industries, history data 2013-2019 and forecast data 2020-2026; This report also studies th...

IoT in Livestock Management Market 2021 | Outlook, Growth By Top Companies, Regions, Types, Applications, Drivers, Trends & Forecasts by 2026

Author: Partha Ray

The latest IoT in Livestock Management market report guides investors, marketers, businesses, and other stakeholders in making well-informed decisions pertaining to Covid-19 challenges and future proceedings of the industry.



Internet of Nanothings (IoNT) Market Future Scope Demands and Projected Industry Growths to 2026

Author: Partha Ray

Internet of Nanothings (IoNT) market report, inclusive of Covid-19 impact analysis, evaluates business status and potential of major regions from the perspective of key players, and application/end-user industries.


The resear...