Logistics

With financial bids coming in, Air India disinvestment moves to the final stage

New Delhi | Updated on September 15, 2021

Tatas, SpiceJet’s Ajay Singh said to be among bidders

The strategic sale of Air India has reached the final stage with prospective suitors submitting the financial bids on Wednesday. Though the government said that more than one bid has been received, it did not officially name of any of them.

But sources indicated that the Tatas and SpiceJet’s Ajay Singh in his personal capacity are among the bidders.

To enable AI divestment to take off, FinMin notifies 5 changes in I-T law

The government plans to sell its entire 100 per cent stake in Air India along with the 100 per cent stake in Air India Express and the 50 per cent stake in Air India SATS. This is the second attempt after 2018, when no suitable bidder was found.

“Financial bids for Air India disinvestment received by Transaction Adviser. Process now moves to concluding stage,” Tuhin Kanta Pandey, DIPAM (Department of Investment and Public Asset Management) Secretary, tweeted on Wednesday, the last date for submission of financial bids.

Indian aviation industry sees green shoots of recovery'

Now, the disinvestment process will move to the next step — evaluation of bids, finalisation of bidder’s name based on the highest bid and signing of on the transaction. There are many legal formalities to be completed before the change of ownership can happen. All these are expected to take three months. The Finance Ministry has already made changes to the tax laws to facilitate the sale process.

The net block of fixed assets, according to the Books of Account of Air India for 2020-21 after reducing the accumulated depreciation, is ₹40,078.11 crore. This includes ₹17,871.93 crore on account of right-of-use assets (leased aircraft fleet/land). The enterprise value set for bidding has not been determined so far.

Air India suffered heavy losses since its merger with Indian Airlines. The losses mounted from ₹5,300 crore in 2017-18 to ₹8,500 crore in 2018-19, dipped to ₹8,000 crore in 2019-20 and surged to ₹10,000 crore in2020-21. Its accumulated losses are ₹70,820 crore till March 31, 2020.

Published on September 15, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

  1. Comments will be moderated by The Hindu Business Line editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.

You May Also Like