Govt. plans to sell Air India, AI Express together
Separate bidders likely for regional airline Alliance Air; process to be concluded by June 2018
The National Democratic Alliance (NDA) government is working to conclude the sale of national carrier Air India by June 2018 and is keen on selling its core airline operations, together with its low-cost international airline, Air India Express.
As per a decision taken by the Air India-specific Alternative Mechanism — a group of Ministers led by Finance Minister Arun Jaitley to decide on the modalities of stake sale in the national carrier — the Centre will look to sell AI’s regional airline Alliance Air to a separate universe of bidders while Air India and Air India Express will likely go together.
At a meeting of the ministerial group on September 21, the view was that a separate universe of bidders or prospective buyers be invited for Air India’s ground handling subsidiary — Air India Air Transport Service Limited (AIATSL) — and its maintenance, repair and overhaul (MRO) unit — Air India Engineering Services Limited (AIESL) — top government sources said.
Talks with buyers
“The rationale is that we can find prospective buyers from international airlines if we call bids for Air India and Air India Express together. Since Alliance Air operates flights mainly on regional domestic routes, it makes more sense to sell it off separately,” a source added.
The decision was taken after the government held several rounds of backchannel talks with prospective buyers of Air India and its subsidiaries.
Sources said the government met companies involved in MRO, ground handling and airline operations to examine whether all the subsidiaries should be sold off together or calling for separate set of bidders would increase Air India’s valuation.
The National Democratic Alliance (NDA) government is working to conclude the sale of national carrier Air India by June 2018 and is keen on selling its core airline operations, together with its low-cost international airline, Air India Express.
As per a decision taken by the Air India-specific Alternative Mechanism — a group of Ministers led by Finance Minister Arun Jaitley to decide on the modalities of stake sale in the national carrier — the Centre will look to sell AI’s regional airline Alliance Air to a separate universe of bidders while Air India and Air India Express will likely go together.
At a meeting of the ministerial group on September 21, the view was that a separate universe of bidders or prospective buyers be invited for Air India’s ground handling subsidiary — Air India Air Transport Service Limited (AIATSL) — and its maintenance, repair and overhaul (MRO) unit — Air India Engineering Services Limited (AIESL) — top government sources said.
Talks with buyers
“The rationale is that we can find prospective buyers from international airlines if we call bids for Air India and Air India Express together. Since Alliance Air operates flights mainly on regional domestic routes, it makes more sense to sell it off separately,” a source added.
The decision was taken after the government held several rounds of backchannel talks with prospective buyers of Air India and its subsidiaries.
Sources said the government met companies involved in MRO, ground handling and airline operations to examine whether all the subsidiaries should be sold off together or calling for separate set of bidders would increase Air India’s valuation.
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