Monday, June 05, 2017

No gradual stake sale: Air India may be privatised at one go

New Delhi: Privatising Air India at one go is a view that has emerged strong among the many that the Narendra Modi government is grappling with regarding the future of the airline.

Business Standard has learnt from sources who are involved in this process that once a final decision to divest a stake in Air India is taken, there won’t be any gradual stake sale. In a single stroke, the government will cede control by reducing its stake to either below 49 per cent, or exit the national carrier completely.

“No investor, domestic or foreign, will be interested in buying a minority stake in Air India. There won’t be a 10, 15, 20 per cent stake sale. It has to be privatisation at one go. The decision to be taken is whether the government will bring down its ownership to below 49 per cent or exit altogether,” said a senior government official. The official said that a number of departments in the government, including the Prime Minister’s Office, civil aviation ministry, and finance ministry, are considering various options regarding the national carrier, which is laden with a debt of Rs 46,570 crore.

A number of informal discussions have taken place on this. The consensus view is that there is no sense in the Centre divesting stakes and retaining ownership. The final decision would be taken by the Cabinet in the next couple of months, sources said.
05/06/17 Arup Roychoudhury/Business Standard

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