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The last date for submission of Expression of Interest for Air India has been extended till December 14 from October 30 earlier.
The Qualified Institutional Bidders will be invited to start bidding for AI from December 28, the latest Corrigendum states.
The divestment of Air India restarted on January 27 this year with the government seeking to sell 100 per cent of its equity share capital in the state-owned airline, including Air India’s shareholding interest of 100 per cent in AI Express Ltd and 50 per cent in Air India SATS Airport Services Private Ltd.
Initially, a deadline of March 17 was set for interested parties to submit their bids. At that time the government hoped to identify the pre-qualified bidders by March 31, followed by the second stage of the divestment process, with price bids being called to eventually decide who Air India would be sold to. It was then estimated that it would take another two to three months after March for the entire process to be completed. Ernst & Young is the transaction advisor for the divestment process
Unlike the previous failed bid to sell AI, this time the government has decided to off-load its entire stake. When the divestment process started, the airline’s debt had been reduced to Rs 23,286 crore from Rs 60,074 crore previously. The government has also clarified that the net working capital is zero, which means that the Maharaja’s current assets are equal to its current liabilities.
Sources in the government said it is looking at the divestment to stop funding losses that the airline has repeatedly been posting, adding that the government needed to give flexibility in uncertain environment. “It is good money chasing bad money,” a senior government official said.
Domestic air fares will continue to be capped at the lower and upper level for another three months from the earlier deadline of November 24, Hardeep Puri, Minister of State for Civil Aviation said on Thursday.
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