To make debt-ridden Air India more attractive for buyers, the government on Monday announced it would give up 100 per cent stake in the national carrier. The deadline for submitting Expression of Interest (EoI) is March 17.
"The government has invited Expression of Interest for proposed strategic disinvestment of Air India Ltd by way of the transfer of management control and sale of 100 per cent equity share capital of Air India Ltd held by the Government of India," a government notification said.
Ernst and Young LLP India has been appointed as transaction advisor by the Centre for advising and managing the proposed strategic disinvestment of Air India. In 2018, the government proposed to offload 76 per cent equity share capital of the national carrier as well as transfer the management control to private players. However, there were no bidders.
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Here are the main conditions set by the government for the sale of Air India:
- Any private limited company, public limited company, limited liability partnership or body corporate is eligible to invest in the state-owned airline provided such parties obtain applicable statutory approvals.
- For submitting EOIs and for being considered for subsequent qualification, a bidder should have a minimum net worth - the aggregate value of the paid-up equity share capital and all reserves - of Rs 3,500 crore. In the case of LLP, the net worth should be calculated as the aggregate value of partners' capital and all its reserves.
- The notification says that bidders must agree to assume the debt apart from other liabilities, and that debt worth Rs 23,286.5 crore would remain with Air India and Air India Express at the time of the disinvestment. The remaining debt would be allocated to Air India Assets Holding Limited.
- As part of the strategic disinvestment, Air India would also sell 100 per cent stake in low-cost airline Air India Express and 50 per cent shareholding in joint venture AISATS, as per bid document issued on Monday. "As a part of the disinvestment, 100 per cent equity stake in AI along with AI's 100 per cent equity stake in AIXL and AI's 50 per cent equity stake in AISATS is being disinvested by the Government of India," the notification added.
- Management control of the airline would also be transferred to the successful bidder.
- AI has interests in other entities (Air India Engineering Services, Air India Air Transport Services, Airline Allied Services and Hotel Corporation of India) which are in the process of being transferred to a separate company -- AIAHL and will not be a part of the Proposed Transaction. AISATS, which is an equal joint venture between Air India and Singapore Airlines, offers ground handling services. Besides, Air India has interests in Air India Engineering Services, Air India Air Transport Services, Airline Allied Services and Hotel Corporation of India.
Also read: Govt to sell 100% stake in Air India; issues bid document
Edited by Manoj Sharma
Management control of the airline would also be transferred to the successful bidder 
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