Currently, the Government of India holds a 100 per cent stake in the airline and its subsidiary Air India Express. The government said that as part of the sale, the control of the carrier will remain with an Indian entity limiting the scope of any foreign bidder who is interested in the asset. In a document inviting expressions of interest, the government said that it would sell a 100 per cent stake in the carrier which operates both domestic and international routes. As the government is set to invite preliminary bids from selling 100 per cent stake Air India, all eyes are on the portion of airline debt to be taken off its books and qualification for suitors. According to industry sources, some of the potential bidders could be Tata Group, Indigo, Spicejet and few private equity firms.
The government has set March 17 as a deadline for potential buyers to submit their initial expressions of interest. Any bidder will need to agree to assume roughly $3.26 billion in debt along with other liabilities, according to the sale document. In 2018, the government had tried to sell 76 per cent stake in Air India and offload about $5.1 billion of its debt that potential buyers at the time viewed as too onerous. Air India has some of the most lucrative international and domestic landing and parking slots that are vital for airlines.
With Air India reeling under around Rs 80,000 crore worth of debt, the government has said that there is no option left with it but to privatise the carrier. In the past decade, Air India’s accumulated losses stood at about Rs 69,575.64 crore, aviation minister Hardeep Singh Puri informed the Parliament in December. According to industry analysts there could be significant investor interest Air India given its wide domestic and international network, traffic rights, slots at key foreign airports such as London and Dubai, large fleet and technical manpower. With Air India reeling under around Rs 80,000 crore worth of debt, the government has said that there is no option left with it but to privatise the carrier.