New Delhi: Indian officials met with as many as nine companies during roadshows to gauge interest in a stake sale in the nation’s loss-making flag carrier, people with knowledge of the matter said.
Officials from the South Asian nation met executives of companies including British Airways parent IAG SA, IndiGo, India’s biggest airline that’s operated by InterGlobe Aviation Ltd., SpiceJet Ltd. as well as Tata Sons Ltd., the people said asking not to be identified discussing preliminary meetings.
A successful sale of Air India Ltd. after a failed attempt in 2018 is crucial for Prime Minister Narendra Modi to help bridge a widening fiscal deficit exacerbated by dismal tax collections and a $20 billion corporate tax cut. Air India, which started as Tata Airlines in 1932 and later acquired by the government, hasn’t made money since 2007. The airline posted a loss of $1.2 billion last year — its highest ever — and has $8.4 billion in total debt.
Representatives at IndiGo, Tata Sons and IAG declined to comment. An official at the civil aviation ministry and Spicejet didn’t immediately respond.
Despite the losses, the airline has some lucrative assets which include prized slots at London’s choked Heathrow airport, a fleet of more than 100 planes and thousands of trained pilots and crew. The government is taking on most of the airline’s debt, leaving any potential buyer to take over $3.26 billion of liabilities only linked to plane purchases, according to bidding documents released on Monday.
The airline will have to shut down if it can’t find a buyer, Aviation Minister Hardeep Singh Puri told the Indian parliament in November.
Also read: Air India sale: Congress & Subramanian Swamy right to call Modi govt bankrupt, anti-national?
TATA should be interested in it as it was the original owners! All other Indian carriers has a good opportunity to expand their net work. BA may offer good deal as the LHR slots are priced commodity. Most airlines are losing money but why Air India. They sell tickets at the same rate as others but their salary bill should be a lot less compared to ‘ foreign’ carriers . The main reason for loss is too many staff per aircraft plus deteriorated service provided. Airline should be run by business people not by IAS babus . In business, quick decision making is very important unlike government organisations where red tapes hold up decisions. Politicians think they know everything and interference from them is also another reason for the downward spiral of AI
It should go to Tatas.
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