Nacil’s plea for Rs 2,300 crore reaches PM

New Delhi: Some relief might be on the horizon for the National Aviation Company of India Ltd (Nacil), formed after the merger of state-owned carriers Air India and Indian. The company’s request for a Rs 2,300-crore bailout package has reached the Prime Minister’s ears.
According to highly placed sources, at a recent meeting with PM Manmohan Singh, civil aviation minister Praful Patel made out a “special case” for Nacil. The company, which is losing Rs 13-14 crore daily, is seeking Rs 1,300 crore towards working capital needs and another Rs 1,000 crore as soft loan.
Some months ago, the civil aviation minister had indicated that he was in favour of a public issue for Nacil after the merger of Air India and Indian was completed. Rumours of divestment of 10-15% equity to raise the much-needed capital were doing the rounds. But the public issue plan was subsequently shelved. According to sources, Patel now thinks Nacil’s fresh demand of Rs 2,300 crore is not “a bad idea”.
“A public issue was being discussed. So Patel doesn’t find capital infusion such a bad idea,” a source said, adding that the company would now have to approach the government with a formal proposal for the cash it needs.
12/07/08 Sindhu Bhattacharya/

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Categories: NACIL Jul 2008