Air India sale: No bids yet but government still hopeful as deadline ends today
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With just a day left for submitting the expressions of interest (EoI) for Air India, civil aviation secretary RN Choubey on Wednesday said that so far they have not received even a single bid. After having extended the last day for submitting the EoIs from May 14 to May 31, the secretary also said that any further extension would not be given. However, Choubey still exuded confidence, adding that he expects bids to come at the last hour. The lack of enthusiasm seen so far by private parties in bidding for Air India is due to several issues, which were raised in the form of queries.
The primary concern is that of the total Rs 48,781-crore debt of the airline, Rs 24,576 crore would be passed on to the buyer. The other concern is that the government will retain a 24% stake in the carrier, which may act as a constraint for the buyer when it comes to crucial decisions with regard to the running of the airline.
Major Indian carriers like IndiGo and SpiceJet had said that they would not participate in the process. Jet Airways chairman and promoter Naresh Goyal, however, was quoted recently in the media stating that Air India is very much on his radar. The Tatas, who run two airlines in India , one a budget carrier, AirAsia India, and the other a full-service carrier, Vistara, in a joint venture with international carriers, had expressed reservations about running the Air India business in isolation of its existing airline businesses. The government subsequently amended that condition later. But sources in the know of the process told FE that the final outcome would be known only by the evening of May 31 and they expect bids to come.
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