Monday, June 05, 2017

Govt looks at three options for disinvestment of AI

New Delhi: The government is looking at three options for Air India disinvestment, including holding up to 49% in the national carrier, even as it is almost certain to take over a large part of the debt burden to make the airline more attractive for buyers.
Sources said while there has been a recommendation to completely exit the perpetually loss-making airline, another possible route to follow is the Maruti model, where the government handed over majority control to Suzuki, for which it received a premium. Later the government reduced its stake further through a public issue. A chunk of government shares were also sold to Indian banks and financial institutions through a bidding process, which was more like warehousing them before being offloaded in the markets.
Several global airlines, where governments have exited, have offered large chunks of the holdings to the public.
The Air India divestment has gathered momentum in recent weeks with NITI Aayog recommending up to 100% stake sale, along with writing off debt.
Finance minister Arun Jaitley too has backed the idea and he has held at least one round of consultations with civil aviation minister A Gajapathi Raju, with sources indicating that the entire process will be speeded up. The sources added that various options are being looked into and a final decision will be taken by the Union cabinet.
05/06/17 Saurabh Sinha/Times of India
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