Air India is sitting on a debt pile of around Rs 58,000 crore, besides huge accumulated losses running into thousands of crores.
The government is planning to invite preliminary bids for 100 per cent stake sale in Air India next month and already some entities have expressed interest in the national carrier, sources said. The airline is sitting on a debt pile of around Rs 58,000 crore, besides huge accumulated losses running into thousands of crores.
Some entities have already expressed interest in buying Air India, the sources said, adding the Expression of Interest (EoI) document is being given the final touches. EoI inviting bids for 100 per cent stake sale are likely to be floated either this month-end or next month, they added. Bidding for the national carrier will be carried out through a newly developed e-bidding system.
Last week, Civil Aviation Secretary Pradeep Singh Kharola took a review meeting of Air India ahead of the airline’s board meet, which scheduled to be held on October 22 for clearing the consolidated account statement for the fiscal ended March 2019.
Earlier this month, Air India management held a meeting with its trade unions on the proposed privatisation of the loss-making carrier. Majority of its unions are opposed to the move, fearing job losses.
As part of efforts to clean up the balance sheet of Air India, around Rs 30,000 crore of its debt is to be repaid by way of proceeds from the issuance of bonds by its special purpose vehicle, Air India Asset Holding Ltd (AIAHL).
AIAHL was set up for warehousing accumulated working capital loans not backed by any asset along with four subsidiaries — Air India Air Transport Services Ltd, Airline Allied Services Ltd, Air India Engineering Services Ltd (AIESL) and Hotel Corporation of India Ltd (HCI) — and non-core assets, including paintings and artefacts.
It has already so far mopped up a total of Rs 21,985 crore by way of bond issues since September 16 and the proceeds would be utilised to pare the debt of the national carrier.