Air India stake sale: Even as the deadline for submitting bids to pick up a stake in Air India comes to an end, the state-run carrier drew a blank, with even potential bidders IndiGo and Tata Group staying away.
Air India stake sale: Even as the deadline for submitting bids to pick up a stake in Air India comes to an end, the state-run carrier drew a blank, with even potential bidders IndiGo and Tata Group staying away. The civil aviation ministry said in a tweet that no bids were received for Air India disinvestment, and the future course of action will be decided later.
Yesterday, civil aviation minister RN Choubey had said that no bis have been received so far, and he expects bids to come in at the last moment. According to a Reuters report, the Indian government’s offer to sell stakes in Air India has failed to draw a single bid so far. While IndiGo had earlier shown interest in the foreign operations of Air India the firm had recently said that Aditya Ghosh said in a recent statement that IndiGo may not have the capability to take on the task of acquiring and successfully turning around all of Air India’s airline operations. Yesterday, the civil aviation secretary RN Choubey had also ruled out any extension of deadline yesterday.
As informed by the Transaction Adviser, no response has been received for the Expression of Interest floated for the strategic disinvestment of Air India. Further course of action will be decided appropriately.
— Ministry of Civil Aviation (@MoCA_GoI) May 31, 2018
The government plans to sell up to 74% stake in the carrier, and the divestment would include profit-making Air India Express and joint venture AISATS, an equal joint venture between the national carrier and Singapore-based SATS. Providing more time, the last date for submission of Expressions of Interest (EoIs) for Air India disinvestment was extended to May 31 from the earlier deadline of May 14. Selling the state carrier is key to the government’s plan to divest assets and help keep the fiscal deficit at 3.3 percent of GDP, a goal already under pressure from giveaways to farmers and other welfare benefits ahead of a national election in 2019, says a Reuters report.
“Relative to what we are seeing this year … uncertainty in the financial markets, aggravated distress among banks and rising interest rates and oil prices, it does not seem like a very supportive time for people to come and buy such an asset,” Renu Kohli, a Delhi-based independent economist told Reuters.