Tata-SIA and LN Mittal Kotak Mahindra consortium are the other two contenders.

A communication from the global advisors ANZ Investment Bank to Videocon International stated that the company has been shortlisted as `Qualified Interested Party' to proceed to the next stage of transaction.

The letter said, "After examination of your expression of interest with respect to the pre-qualification criteria set out in the expression of interest advertisement, you have been qualified as the `Qualified Interested Party' to proceed to the next stage of transaction."

The qualified parties concerned have been asked to sign a deed of confidentiality undertaking before December 22, 2000. Any member to subsequently join the consortium or joint venture too would be required to sign the deed of confidentiality undertaking.

On receipt of the same, the qualified parties would be sent a bid pack on the disinvestment of Indian Airlines.

Indian Airlines, as on date, accounts for a net worth in excess of Rs 700 crore. The rest 25 per cent divestment would be shared by mutual funds/financial institutions to the extent of 14.5 per cent and Indian Airlines employees to the extent of 10.5 per cent.

The government of India, through the global advisors ANZ consortium, comprising ANZ Investment Bank, Speedwing and IDBI, had invited expression of interest to disinvest 26 per cent of its shareholding in Indian Airlines.

Indian Airlines operates nearly 270 flights a day carrying around 23,000 passengers to various domestic and international destinations, accounting for 50 per cent ot the total traffic. It has a fleet of 55 aircraft, including 30 Airbus A-320.

Videocon had made a surprise bid, backed by Bank of America, for IA privatisation on the last day in November. Videocon will utilise Rs 800 crore cash surplus generated last fiscal for acquiring this stake and need not mop up funds from the market.