The government of India has decided on strategic disinvestment of the loss-making Air India, which is staying afloat on taxpayers’ funds, and a ministerial panel is working on the modalities. The country has also invited applications from investment bankers, law firms and other entities to act as advisers for strategic stake sale of the flag carrier.
It is looking for reputed investment bankers, merchant bankers, financial institutions and banks for providing advisory services and managing the strategic disinvestment process. Applications have to be submitted by October 12.
The notices for Expression of Interest have been issued by the Department of Investment and Public Asset Management.
Under a turnaround plan approved by the previous UPA regime, Air India is to receive up to Rs 30,231 crore from the government subject to meeting certain performance thresholds. The ten-year bailout package began from 2012. So far, the embattled carrier has received around Rs 26,000 crore under the package.
The Cabinet Committee on Economic Affairs (CCEA) gave its in-principle nod for the strategic disinvestment of the airline — which has a debt burden of more than Rs 50,000 crore — in June this year.
Air India is also planning to take short term loans worth up to Rs 3,250 crore to meet “urgent working capital requirements”.