Air India’s disinvestment, the big-ticket PSU sale which could boost the government coffers and help it unload a white elephant, might have just hit a snag even before taking off. A top government official has said that the government could, after all, decide not to sell the national carrier Air India, which has so far struggled to find takers since it was put on the block.
“The Government retains the right to sell or not to sell Air India if the bid price is found to be inadequate,” Civil Aviation Secretary RN Choubey said to reporters on the sidelines of an event on Tuesday. The highest bidder for Air India should become known by the end of August, media reports said citing Choubey.
In March, the government had unveiled plans to sell up to 76 percent stake in the national carrier and transfer the management control to private players, and the winning bidder would be required to stay invested in the airline for at least three years. Expression of Interest (EoI) was sought from various entities, including foreign airlines to start off the disinvestment exercise
Paving a way for privatization, the Union Cabinet in June last year had provided an in-principle approval for debt-ridden Air India’s disinvestment. In September, the government invited applications from investment bankers, law firms, and other entities to advise it on the stake sale. While many domestic airlines including IndiGo and SpiceJet have already ruled themselves out of the race for acquiring a stake in the national airline, a recent Bloomberg report said that Jet Airways chairman Naresh Goyal has Air India on his radar. “We are looking at our own business. But I am not saying that we will not look at Air India, I’ve never said that. Ultimately we will always see what is the best approach ahead of us, and for the country,” Bloomberg reported Naresh Goyal as saying.