Tuesday, August 28, 2018

Centre Plans Rs 7,000 Crore SOS Fund to Bail Out Air India, Transfer of Debt to Special Purpose Vehicle

New Delhi: The finance ministry has approved a bailout package for national carrier Air India to steer it out of serious financial turbulence.

The bailout package could be announced by this weekend, sources told CNBC-Awaaz. Officials said the bailout would be in two parts – a capital infusion of Rs 7,000 crore and transferring of debt to a special purpose vehicle.

The ministry would also give a bank guarantee of Rs 2,000 crore on behalf of the cash-strapped carrier. This loan would be used as working capital by the airline, sources said.
The civil aviation ministry had recently held discussions with the finance ministry to get a Rs 11,000 crore bailout package for the ailing Air India, but it was rejected as the majority of it would have gone into servicing debts and would have done little to improve the core operations of the airline.
27/08/18 News18.com