India Says No Plan for Air India Divestment, IPO

New Delhi: India's federal government doesn't have any plan currently to divest its stake in loss-making national carrier, Air India, Civil Aviation Minister Praful Patel said Thursday.
The government also doesn't plan to make an initial public offering of shares of Air India, Mr. Patel said in response to queries by lawmakers in the lower house of Parliament.
"Presently, there is no such proposal," he said.
The government has been mulling an IPO for Air India for several years to raise money to buy new planes from Boeing Co. and Airbus as well as fund current operations.
In 2007, the government merged its two carriers - Indian Airlines Ltd. and Air India Ltd. - to create a larger airline to compete with Singapore Airlines Ltd., Lufthansa AG and other foreign carriers expanding into India. The government also wanted to secure better valuation with a merged entity during a public offering.
However, the global financial turmoil and falling stock markets led to a delay in the listing process of the new airline.
A slowing global economy and higher oil prices led Air India toward an estimated net loss of 50 billion rupees ($1.02 billion) in the fiscal year ended March 31, leading the airline to delay June salaries to all its 31,000 workers.
09/07/09 Santanu Choudhury/Dowjones/Wall Street Journal

To Read the News in full at Source, Click the Headline

Categories: NACIL Jul 2009