Logistics

Air India stake sale: Govt extends deadline to receive initial bids

PTIAshwini Phadnis | | Updated on: May 01, 2018
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Issues clarifications for 160 questions on the proposed sale

The government has extended the last date for intimating the qualified Interested Bidders to June 15 from May 28 earlier. This has been indicated in the Corrigendum issued by the Ministry of Civil Aviation to the Expression of Interest.

The proposed divestment of Air India Limited will be carried out by transfer of management control and sale of 76 per cent equity share capital of Air India held by the government. The disinvestment would include profit-making Air India Express and joint venture AISATS, an equal joint venture between the national carrier and Singapore-based SATS Ltd.

Besides, Air India and Air India Asset Holding limited will commit to pay Rs 1,298.2 crore to its employees towards the implementation of the Justice Dharamadhikari Commission report before the sale of government stake in Air India is finalised.

This has been indicated in the Clarifications sought by Interested Bidders on PIM/EoI for the Strategic Disinvestment of Air India and its Subsidiaries/JV which the Ministry of Civil Aviation put up on its website on Tuesday.

PTI adds:

Clarifications

The government today came out with a set of clarifications on the proposed strategic disinvestment and said individuals other than the airline’s employees would not be allowed to bid. It had issued preliminary information memorandum on March 28 for the proposed sale of up to 76 per cent stake in Air India along with management control to private entities.

The government has put out clarifications for 160 questions from interested bidders on the disinvestment of Air India and its two subsidiaries -- Air India Express and AISATS. According to the 19-page document released today, the government has clarified that “individuals (other than employees) are not allowed to bid.”

Also read: Bidders can pick up to 51% stake in Air India

Clarifications have been provided on various other aspects, including those related to slots, bilateral rights and employee rights. “Details of existing slots and code share agreements will be provided at RFP (Request for Proposal) stage. It is expected that there will not be any impact of disinvestment on existing slots and bilateral rights.

“Bidders are advised to undertake their own assessment for the impact of disinvestment process on the existing code share agreement,” the government said. This was in response to queries on whether privatisation would impact renewal of existing slots and bilateral flying rights. For more than 50 queries, the government has said details would be provided at the time of RFP stage.

To a query related to staff, the government said, “employee concerns are being suitably addressed. Grounded aircraft are assets of Air India. Successful bidder/ Air India post strategic disinvestment can deal with them/ dispose as deemed fit subject to the terms and conditions of the Shareholders’ Agreement,” it said.

As per the information memorandum, issued in March, the government would retain 24 per cent stake in the national carrier, the winning bidder would be required to stay invested in the airline for at least three years. In the set of clarifications, it has been emphasised that “it is a considered decision by Government of India to retain 24 per cent stake”.

Published on May 01, 2018

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