Comments
The government is making another attempt to divest its stake in Air India by selling 98 per cent of its stake in Air India Air Transport Services Ltd (AIASTL), the subsidiary which does grounding handling work.
The remaining 2 per cent stake in the company can be taken by the employees, but if they choose not to then the entire 100 per cent stake will be sold to a private entity.
On Tuesday, the Preliminary Information Memorandum (PIM) for the sale was issued to interested parties, thereby kick- starting the divestment process. The government has set March 26 as the last date for submission of interest from interested parties and intimating the qualified bidders on April 9.
A clearer picture on when the Air India subsidiary will be sold will known by April 9 when those who are qualified for bidding will be asked to put in financial bids. The timelinefor submitting financial bids for the subsidiary and by when the government is expected to take a final decision on the bid will be made public on April 9 when the Request for Proposal (RFP) will be invited, said a person closely connected with the divestment process.
The memorandum points out that as on March 31, 2018, AIATSL did not have any term loan facilities with banks/financial institutions and it did not have any significant contingent liabilities. “Any changes with respect to the same, based on the audited financial statements, would be provided in the RFP,” it said.
An entity or individual interested in bidding for AIATSL will need to have a minimum net worth of ₹200 crore and does not require any prior experience in ground handling activities in order to participate in the bidding process.
The forthcoming Lok Sabha polls are unlikely to affect the divestment process as recently a senior official of the Ministry of Civil Aviation had told newspersons that the government will seek the advice of the Election Commission and Law Ministry on whether the AIATSL divestment process can go ahead when the model Code of Conduct is in place only if “there is any response and interest in the PIM.”
The PIM lists out the fact that the AIASTL has been consistently making profits since the commencement of its autonomous functioning from 2014 – 2015 with average EBITDA margins of 19 per cent and average profit after tax margins of 11 per cent for the last three financial years.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.