Air India stake sale to fetch £700 million

Thursday 17th January 2019 01:22 EST
 
 

The Government of India is currently eyeing around $1 billion from the sale of national carrier Air India in the next financial year. A government official said the administration will initiate the process of strategic disinvestment of Air India in the second half of 2019-20 and in between it would work towards selling some of its subsidiaries and monetise assets. Air India has a debt burden of £5.5 billion. A ministerial panel led by Finance Minister Arun Jaitley had approved transferring £2.9 billion debt last November, to a special purpose vehicle (SPV)- Air India Asset Holding Company.

The official said, “We are eyeing USD 1 billion from the sale of Air India.” After a botched attempt to sell Air India in May last year, the Jaitley-led panel decided in June to scrap the stake sale plan for the time being. It was decided to infuse more funds into the carrier and cut down debt by raising resources by selling land assets and other subsidiaries. The Centre had initially planned to offload 76 per cent equity share capital of the national carrier as well as transfer the management control to private players. The buyer was required to take over £2.4 billion debt of the carrier along with over £800 million of liabilities. However, the stake sale failed to attract any bidders when the bidding process completed on May 31.

Earlier this month, the Parliament approved a further £234.5 million equity infusion into the airline. The ministerial panel has already cleared strategic sale of Air India's ground handling subsidiary, Air India Air Transport Services.


comments powered by Disqus



to the free, weekly Asian Voice email newsletter