Tata Sons and SpiceJet grouping offer financial bid to Air India
Tata Sons and promoters of SpiceJet have offered a financial bid to ailing Air India. The center to soon finalise the prices ahead of the sale of airlines
Wednesday (September 15) was the last day for submitting papers of financial bid to buy 100 per cent stake of Air India. As per the media reports, the center to soon set the floor price ahead of sale of the airlines. Tata Sons and the promoters of the SpiceJet grouping have apparently submitted papers of financial bid to buy Air India company. The secretary, Department of Investment and Public Asset Management is managing the bids. It took to Twitter to share, “Financial bids for Air India disinvestment received by Transaction Adviser. Process now moves to concluding stage.”
Earlier the center was reportedly in plans of selling a 76% stake to the conglomerates. However, now the plans have been changed and government now wants to sell 100% stake of Air India. The process for the bidding was initiated in January this year, but because of the pandemic Coronavirus led challenges it was delayed further.
For the unversed, the total debt on Air India was estimated to be ₹60,074 crore as of March 2019. This debt amount will be transferred to the new owner of the airlines, however, with a flexibility clause that the center considered to make the deal ease for the bidding parties. As per this new clause, the new owner can have ₹23,286.5 crore and the rest of the money would need to be transferred to Air India Assets Holding Ltd, a special purpose vehicle.
Key points to be noted:
- Bid winner /new owners will get Air India Exp and 50 per cent stake on ground handling services AISATS
- The winner will have to meet all the security standards on ground
- Tata group promoted AI in 1931, but later sold its interests to government in 1953
- Tata’s made the offer financial bid offer via its 100 per cent arm i.e. Talace Pvt Ltd. The grouping led by Ajay Singh has apparently placed the bid in his personal capacity alongside few of the investment funds
- The balance of 50 per cent in ground handling business is owned by Singapore’s SATS, a partner in Tata Sons air catering venture
For more such updates, stay hooked on to The Live Mirror.