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Govt looks to divest 76 percent stake in Air India
The central government on Wednesday invited Expression of Interest (EoI) for the strategic divestment of national passenger carrier Air India (AI), along with the airline’s shares in Air India Express (AIXL) and Air India SATS Airport Services (AISATS).
New Delhi: The central government on Wednesday invited Expression of Interest (EoI) for the strategic divestment of national passenger carrier Air India (AI), along with the airline’s shares in Air India Express (AIXL) and Air India SATS Airport Services (AISATS).
“The Government of India has given ‘in-principle’ approval for the strategic disinvestment of AI by way of the transfer of management control and sale of 76 per cent equity share capital of AI held by GOI, which will include AI's shareholding interest in the AIXL and AISATS,” said the Preliminary Information Memorandum document.
Management or employees can participate directly in the bidding process or by way of forming a consortium, as per the memorandum. Ernst & Young LLP India has been appointed as transaction adviser for the strategic disinvestment process.
Air India is the country’s flag air carrier with a significant market position in international and domestic operations. The Preliminary Information Memorandum said the transaction will involve Air India, its low-cost arm Air India Express and Air India SATS Airport Services Pvt Ltd. The latter is an equal joint venture between the national carrier and Singapore-based SATS Ltd.
In June 2017, the Cabinet Committee on Economic Affairs (CCEA) gave in-principle nod to the strategic disinvestment of the airline, which has a debt burden of over Rs50,000 crore. Subsequent to the decision, the Air India Specific Alternative Mechanism (AISAM), headed by Finance Minister Arun Jaitley, was set up to decide on specific issues. The national carrier is staying on taxpayers' money under the turnaround plan approved by the previous UPA government in 2012.
