Friday, June 08, 2018

Govt to pursue Air India stake sale this fiscal, revised bidding norms likely soon

The government will continue to pursue disinvestment of debt-laden Air India and revised bidding norms are likely to be finalised soon, officials said, even as the stake sale proposal elicited muted response from the investors.

After no bidders put in their Expression of Interest (EoI) for the strategic disinvestment of Air India and its two subsidiaries last month, the civil aviation ministry is now gathering inputs from transaction advisor to understand the reasons on the failure to attract bidders.

"We had not envisaged a situation when there would be no bids. Disinvestment of Air India is very much on the table," a government official said.

Asked if the government could look at selling entire 100 per cent in Air India, the official said, "We would look at simplifying some of the norms, but it would not be entirely different from what the thinking behind the disinvestment has been earlier".

In a major setback, no initial bids were received for the Air India disinvestment when the deadline for submission of Expression of Interest (EoI) ended on May 31. EY is the transaction advisor for Air India disinvestment.

Officials said the ministry is consulting the transaction advisor on the inputs they have received from the market about the disinvestment plan. This would help in understanding what were the factors that may have held back the investors from bidding for Air India, they added.

A government official said the ministry would look at which provisions of the Preliminary Information Memorandum (PIM) needs to be reworked.

According to officials, more clarity might be required with regard to foreign fund managers in the context of Air India disinvestment. However, they did not elaborate on the issues involved.
07/06/18 PTI/