Salt-to-software conglomerate Tata Group and based in the US. Interups Inc fund they were among “multiple” entities that submitted preliminary offers last week to buy the losing carrier Air India.
A group of more than 200 Air India employees also submitted an Expression of Interest (EoI) for the airline in partnership with Interups at the close of the deadline on December 14.
“The Transaction Advisor will inform the qualified bidders before January 6, after which the bidders will have access to Air India’s virtual data room (VDR),” said an official.
The share purchase agreement will be shared with bidders, after which financial offers will be invited, the official added.
“The transaction will be finalized only in the next fiscal year as we expect bidders to have many inquiries once they gain access to VDR and before submitting their financial offers,” the official told PTI.
The government is selling its entire 100 percent stake in Air India which has suffered losses since its merger in 2007 with the national operator Indian Airlines.
The stake sale process was delayed due to the COVID-19 pandemic and the government extended the deadline five times to submit preliminary offers for the national airline.
The airline, which started as a postman in 1932, will grant the successful bidder control of 4,400 domestic and 1,800 international landing and parking spots at domestic airports, as well as 900 spots at airports abroad.
In addition, the bidder would also get 100% of the low-cost arm. Air India Express and 50 percent from AISATS, which provides cargo and ground handling services at major airports in India.
Since previous attempts since 2017 failed to achieve any significant interest, the government this time sweetened the deal by giving would-be suitors free to decide how much of the airline’s debt they want to assume as part of the transaction.
Previously, bidders had to take over the total debt of Rs 60,074 crore.
Secretary of the Department of Investment and Management of Public Assets (DIPAM) Tuhin Kanta pandey It had previously said that potential investors in Air India had given their opinion that due to the uncertainty created by COVID-19 in the aviation sector, the debt should not be fixed at the expression of interest (EoI) stage.
Therefore, in late October, the government decided to bid for Air India based on business value, which includes a company’s market capitalization, short-term and long-term debt, as well as any cash on the balance sheet of the company.
In the current fiscal year, the government has set a record divestment target of Rs 2.10 crore. The target includes Rs 1.20 crore for the sale of shares in central public sector companies (CPSE) and Rs 90 billion for the sale of shares in public sector banks and financial institutions, including the insurance giant’s listing. LIC.
So far this tax, Rs 11,006 crore has been absorbed through the sale of minority stakes in CPSE.
After its unsuccessful attempt to sell the loss-making airline in 2018, the government in January 2020 restarted the divestment process and invited tenders to sell 100% of its capital in the state airline, including Air India’s 100% stake. in AI. Express and 50 percent in Air India SATS airport services (AISATS)
In 2018, the government had offered to sell its 76 percent stake in the airline.
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