Air India-SATS combine's final decision soon

Ashwini Phadnis

New Delhi, Dec. 26

The Air India-Singapore Airport Terminal Services (SATS) consortium, that won the bid for cargo handling at the greenfield airport in Bangalore, plans to award the civil contract for the project to Larsen & Toubro (L&T).

Official sources told

Business Line

that while a final decision on the award will be taken shortly, there were several advantages in roping in L&T to do the civil work for the project.

Win-win situation

"Bangalore International Airport Ltd (BIAL), the company undertaking development of the new airport, has awarded a majority of contracts to L&T especially those relating to construction. L&T already has manpower, expertise and equipment in place at the existing site. So, awarding the contract to them would prove a win-win situation," an official of the consortium said.

While the total cost of the cargo-handling project is Rs 81 crore, the civil construction works project that is likely to be bagged by L&T is estimated at Rs 50 crore.

Completion time

The successful bidder will be required to complete the project within 12 months of it being awarded.

The potential of BIAL, which has signed a 15-year agreement for running its cargo operations, has been estimated between 2,00,000 and 3,00,000 tonnes in the next few years.

Diversification

The decision to go in for the project is one of the attempts being made by Air India to diversify its activities and emerge as a $7-billion turnover company in the next few years.

The SATS group is the provider of integrated ground handling and airline catering services at Singapore Changi Airport.

SATS provides a host of services including airfreight handling, airline catering, passenger services, baggage handling, ramp handling, aviation security, airline linen laundry and processed food manufacturing.

AI-SATS has already appointed AT3, a Singapore based firm, to develop and conceptualise the entire project.

(This article was published in the Business Line print edition dated December 27, 2006)
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