IndiGo not to take part in AI’s divestment

Gurgaon-based low-cost airline IndiGo has said that it will not take part in Air India’s ongoing divestment.

“We do not believe that we have the capability to take on the task of acquiring and successfully turning around all of Air India’s airline operations,” Aditya Ghosh, President and Whole Time Director, said in a statement. Incidentally, IndiGo was one of the first airlines to express an interest and put in an “unsolicited” bid with the government even before the formal divestment process for Air India started.

The statement comes in response to queries from investors regarding IndiGo’s involvement in the upcoming divestiture of Air India. “From Day 1, IndiGo has expressed its interest primarily in the acquisition of Air India’s international operations and Air India Express. However, that option is not available under the government’s current divestiture for Air India,” the statement adds.

IndiGo’s promoters were looking at Air India’s low-cost arm to expand its international operations. The decision to withdraw from the race to pick up a stake in Air India is, however, unlikely to stop the airline’s future international expansion plans.

IndiGo, which currently operates to countries which are four to five hours away from India, is looking to launch flights to global destinations further away from India. It was in that context that IndiGo had decided to put in a bid for Air India’s international operations.

But with the government making it clear that it will sell Air India, Air India Express and Air India’s ground handling entity as one cohesive unit, IndiGo has decided that it was not worth pursuing the divestment process.

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