The government is fast-tracking the divestment of Air India and in doing so has initiated the process of financial bids for the debt-laden airlines. After Aviation Minister Jyotiraditya Scindia said that the September 15 deadline for the process is fixed and won't be changed, the government is expected to complete the sale of the national carrier with at least two buyers.
Air India has a huge debt of Rs 43,000 crore of which Rs 22,000 crore will be transferred to the Air India Asset Holding Limited (AIAHL). Taking to Twitter, DIPAM Secretary, Tuhin Kanta Pandey said that the disinvestment process now moves to the concluding stage.
Final bids for Air India sale and transfer
Tata Sons has submitted a financial bid for Air India, among other bidders, a company spokesperson was quoted as saying. Though Tatas have confirmed their participation in the financial bid, sources said that the promoter of domestic carrier SpiceJet, Ajay Singh may also have placed the bids for the debt-ridden carrier. The Tatas bid was much-anticipated as its name of had been doing the rounds for some time now.
In a bid to fast-track the much-delayed privatisation of the national carrier, the government recently 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 Central Government hereby specifies that no deduction of tax shall be made under section 194-IA of the said Act on any payment made to the Air India Ltd for transfer of immovable property to Air India Assets Holding Ltd under a plan approved by the Central Government," said a notification.
Further, the CBDT also allowed new owners of erstwhile public sector companies to carry forward losses and set these off against future profits, in a bid to raise more interest for the proposed privatisation processes.
During the Budget speech for FY22, Finance Minister Nirmala Sitharaman had said that all the proposed privatisation process would be completed by the end of the fiscal, including the much-delayed strategic disinvestment of Air India.
The Centre is planning to sell 100 percent stake in the airline along with the following:
Air India Express
- 50 percent stake in ground handling company Air India STATS
- Air India building in Mumbai, Airlines House in Delhi
- Four acres land at Connaught Place
- Housing societies in Delhi, Mumbai and other cities
- Air India's subsidiaries including Air India Engineering Services Limited (AIESL) and Air India Air Transport Services Limited (AITSL)