Civil Aviation Minister Hardeep Singh Puri said on Saturday that Air India will divest 100 percent as the choice was now between divesting or closing.
“We have decided that Air India will divest 100%. The choice is not between divestment and not divestment, but between divestment and closing. Air India is a top-tier asset, but it has a cumulative debt of Rs 60 billion. We have to make a clean slate, ”said the Union minister, quoted by ANI.
Referring to the bids the government has received to date, Puri added: “At the last meeting, on Monday, it was decided that the shortlisted bidders for the divestment of Air India will be informed that bids must be submitted within 64 days. This time, the government is determined and there is no doubt ”.
In 2018, the government had submitted the Expression of Interest for Air India to ditch a 76% stake and management control of the airline, but did not win a single bidder. The government currently owns 100 percent of Air India’s shares. However, later on, the government decided to sell 100% of its stake, as the government that had even a minor stake in the airline’s divestiture was seen as a big negative for potential buyers. However, government sources had said that the reason for having a 24% stake was that the sale of the remaining 76% would immediately increase the value of the government’s stake in the airline, which it would offload at a later time.
The new owner will acquire a fleet of 121 aircraft in the Air India fleet and 25 aircraft in the Air India Express fleet. These exclude the four Boeing 747-400 jumbojet jets that the airline plans to transfer to its subsidiary Alliance Air, which is not part of the current transaction. However, as in the last attempt, the properties currently in use by Air India, including the Nariman Point building and the company’s headquarters near Connaught Place in New Delhi, will be held by the government.
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