Categories
Business

Sale of debt-laden ‘Maharaja’ fails to take off

New Delhi: Debt-laden Air India has failed to attract any bids during the process of auctioning of the beleaguered airline, the ministry of civil aviation said in a tweet. Bidders were required to submit the expression of interest (EoI) by 5 PM on Thursday.

The government has proposed to offload 76% equity share capital of the national carrier as well as transfer the management control to private players, as per the preliminary information memorandum.

Aviation secretary RN Choubey had said the deadline for submitting the EoI will not be extended. The original deadline was 14 May, which was extended to the month-end.

Further decisions on AI sale will be taken by the alternative mechanism, Choubey added. An alternative mechanism is a group of ministers, which is headed by the finance minister, formed for divesting the Maharaja.

Air India, founded in 1932, was once the country’s monopoly airline, known affectionately as the “Maharaja of the skies”.

Two months back, the Narendra Modi administration offered to sell 76% of Air India. Of AI’s total debt, bidders for the airline arm — AI, AI Express and AI-SATS (airport service company) — will have to take over debt of Rs 24,576 crore and current liabilities of Rs 8,816 crore or a total burden of Rs 33,392 crore.

Tata Group, Singapore Airlines (SIA), which together run Vistara, and InterGlobe Aviation Ltd, owner of the IndiGo carrier, were all linked to a takeover but have ruled themselves out.

IndiGo was the only one to formally express interest in AI’s international operations but backed out later when the terms said the bidder will need to take over the entire — including domestic — flights of AI and AI Express.

The ailing airline’s total debt stood at over Rs 48,000 crore at the end of March 2017.

By Sirf News Network

Ref: ABOUT US