New Delhi: Air India is likely to ink a memorandum of understanding with government-owned National Buildings Construction Corporation (NBCC) this month to help the flag carrier monetise its assets, after it failed to do so on its own.
The loss-making airline has been struggling to sell or lease its assets including land and buildings that the government recommended as part of a bailout plan in 2012.
"It's a generic MoU that allows NBCC to help Air India monetise its land asses and both of us have agreed on the terms. In the development process, land will be Air India's equity and our equity will be the investment in creating any infrastructure on the land. The profit from any asset will be shared according to the equity," said a top NBCC official, requesting anonymity.
The official added that the NBCC will develop only land and not the apartments and flats that Air India owns across the globe. According to the government's turnaround plan for Air India, the carrier needs to raise Rs 5,000 crore through sale and leasing of assets, which will be used for repayment of loans. The airline has a debt of Rs 40,000 crore, with an annual interest payment outlay of Rs 3,700 crore.
08/09/14 Ravi Teja Sharma & Mihir Mishra/Economic Times
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The loss-making airline has been struggling to sell or lease its assets including land and buildings that the government recommended as part of a bailout plan in 2012.
"It's a generic MoU that allows NBCC to help Air India monetise its land asses and both of us have agreed on the terms. In the development process, land will be Air India's equity and our equity will be the investment in creating any infrastructure on the land. The profit from any asset will be shared according to the equity," said a top NBCC official, requesting anonymity.
The official added that the NBCC will develop only land and not the apartments and flats that Air India owns across the globe. According to the government's turnaround plan for Air India, the carrier needs to raise Rs 5,000 crore through sale and leasing of assets, which will be used for repayment of loans. The airline has a debt of Rs 40,000 crore, with an annual interest payment outlay of Rs 3,700 crore.
08/09/14 Ravi Teja Sharma & Mihir Mishra/Economic Times
