India’s salt to software conglomerate, Tata Group has submitted a bid for faded flag carrier Air India. This is the second attempt when the government is trying to sell the loss-making national carrier. The bid was made Tata Sons Ltd., the group holding company, which controls Jaguar Land Rover and owns a majority stake in AirAsia India. Along with Tata Group, SpiceJet owner Ajay Singh has also bid for Air India, according to media reports.
The government has yet to reveal the names of prospective buyers, though it announced that it had received offers. “Financial bids for Air India disinvestment [have been] received by [the] Transaction Adviser,” Tuhin Kanta Pandey, secretary in the Department of Investment and Public Asset Management, tweeted on Wednesday evening. “Process now moves to concluding stage.”
When it again began seeking buyers in January last year, the government said that even after injecting about 305 billion rupees (US$4.15 billion) into the airline since 2012, Air India had continued to lose money and had accumulated a debt of about 600 billion rupees. Air India has incurred losses since its 2007 merger with fellow state-owned domestic carrier Indian Airlines, weighed down by competition from private budget airlines, as well as rising fuel prices and high debt-servicing costs. The airline reported a net loss of 79. 8 billion rupees in the financial year ended March 2020, the government reported in August, compared with losses of 85.6 billion rupees the year before and 53.5 billion rupees in the financial year ended in March 2018.
The winning bidder will get control of 4,400 domestic and 1,800 international landing and parking slots at domestic airports, as well as 900 slots at airports overseas. In addition to this, the bidder would also get 100 percent of the low-cost arm Air India Express and 50 percent of AISATS, which provides cargo and ground handling services at major Indian airports.