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Updated on: Tuesday, September 28, 2021, 03:03 PM IST

Air India disinvestment: Financial bids to be opened on September 29, says report

According to the report, 85 percent of the bid price will be for Air India's debt, while 15 percent will be in cash./ Representational image | File photo

According to the report, 85 percent of the bid price will be for Air India's debt, while 15 percent will be in cash./ Representational image | File photo

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The Central government proposes to wrap up the divestment of Air India by the middle of next month with the announcement of winning bid for the national carrier.The government is working towards announcing a winning bid for Air India by October 15, sources informed CNBC-TV18.

The financial bids for the airline are likely to be opened tomorrow i.e. September 29, sources said to the business TV channel. "Tatas are being seen as the front runners for Air India divestment," they added.

Sources indicated that tentatively October 15 has been kept the date for announcing the winning bid for Air India while the financial bids received for the carrier may be opened anytime this week.

On September 15, the government said it had received multiple financial bids for divestment of Air India. Accordingly, Tata Sons and industrialist Ajay Singh in his personal capacity are believed to have submitted financial bids for Air India.

Sources indicated while Tatas are front runners to get hold of the carrier, all bids would be evaluated on various parameters and the winning bidder would be announced after approval of the group of ministers (GoM) headed by the home minister

According to the report, 85 percent of the bid price will be for Air India's debt, while 15 percent will be in cash.

Data from the Directorate General of Civil Aviation (DGCA) suggests that AirAsia India, Vistara and Air India together have 26 per cent share of the domestic aviation market. It is still lower than market leader IndiGo that has a market share of 57 per cent, according to news reports.

The government had earlier said it has received multiple financial bids for buying national carrier Air India. A Tata Sons spokesperson told PTI that it has put in a bid for the airline.

The Tatas bid was much-anticipated as its name had been doing the rounds for some time now.

The government has of late taken several steps to fast-track the much-delayed privatisation of the national carrier.

Recently, the government decided to waive taxes on the transfer of assets from the national carrier to Air India Assets Holding Ltd, a special purpose vehicle (SPV).

The government is seeking to sell 100 per cent of its stake in the state-owned national airline, including Air India's 100 per cent shareholding in AI Express Ltd and 50 per cent in Air India SATS Airport Services Private Ltd.

The stake sale process, which begun on January 2020, faced delays due to the COVID-19 pandemic. In April 2021, the government asked potential bidders to put in financial bids.

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Published on: Tuesday, September 28, 2021, 01:50 PM IST
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