Air India’s 100% stake sale set in motion; Subramanian Swamy again threatens to move court to stop it

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Updated: January 27, 2020 12:54:42 PM

As the government looks to offload its stake in debt-ridden national carrier Air India, BJP MP Subramanian Swamy took to social media to threaten court proceedings against the government.

The Air India divestment also means that the government will sell its total stake in its low cost airline unit Air India Express. (Image: Reuters)

As the government looks to offload its stake in debt-ridden national carrier Air India, BJP MP Subramanian Swamy took to social media to threaten court proceedings against the government if it continues with the divestment procedure. He also called the deal anti-national and said that the government should not “sell our family silver”. Self-proclaimed anti-corruption crusader asked the Narendra Modi government to strengthen the airline instead of selling it. However, taking Air India divestment step further, the government today informed potential investors, by issuing a preliminary information memorandum for 100% stake sale in the airline.

“This deal is wholly anti-national and I will forced to go to court. We cannot sell our family silver,” he tweeted.

The Air India divestment also means that the government will sell its total stake in its low cost airline unit Air India Express, and 50% shareholding in joint venture AISATS, according to bid documents, PTI reported. While Air India is reeling under a massive debt of Rs 80,000 crore, the successful bidder will absorb a little over one-third of the existing debt at Rs 23,286.5 crore.

The government has also set the deadline for Expression of Interest in the airline as 17 March 2020. Post privatisation, the management control of the airline will be transferred to the successful bidder. However, various other entities which are currently a part of Air India including Air India Engineering Services, Air India Air Transport Services, Airline Allied Services and Hotel Corporation of India, are currently in the process of being transferred to a separate company called Air India Assets Holding Ltd (AIAHL) as the government does not look to sell them as well, the bid document said. The government also looks to freeze Air India’s debt from the date of Expression of Interest. 

Meanwhile, various Air India employee unions will meet today to discuss the divestment of the cash-strapped airline, PTI reported the sources as saying. The airline also recently reported positive EBITDA for April to December 2019 at Rs 460 crore and the losses of the airline narrowed by 46%, signalling a recovery. 

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