Mumbai/New Delhi: Air India is likely to raise ?7,000 crore in a bond sale, the first in a series to repay a portion of the national carrier’s loans, said two people with direct knowledge of the matter. The bonds will be floated by Air India Asset Holdings Ltd, the special purpose vehicle that has taken on ?29,464 crore of Air India’s debt.
Refinancing Air India’s high cost debt could make the airline palatable for potential investors as the government plans to start the process for the sale of Air India by October. There were no bidders when the government attempted to sell the airline with all its debt in May last year.
Air India had total debt of ?55,000 crore and the reduction by ?29,464 crore cut the carrier’s annual interest liabilities by about ?2,700 crore. The plan is to raise over ?22,000 crore, including the ?7,000 crore, in two tranches.
According to the plan, Air India Asset Holdings will first issue three-year papers, which could yield anything between 7 per cent and 7.25 per cent , dealers said.
Rating company ICRA has graded the proposed bonds a triple-A with stable outlook. Air India Asset Holdings is obtaining another rating.
05/08/19 Saikat Das/Mihir Mishra/Economic Times
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Refinancing Air India’s high cost debt could make the airline palatable for potential investors as the government plans to start the process for the sale of Air India by October. There were no bidders when the government attempted to sell the airline with all its debt in May last year.
Air India had total debt of ?55,000 crore and the reduction by ?29,464 crore cut the carrier’s annual interest liabilities by about ?2,700 crore. The plan is to raise over ?22,000 crore, including the ?7,000 crore, in two tranches.
According to the plan, Air India Asset Holdings will first issue three-year papers, which could yield anything between 7 per cent and 7.25 per cent , dealers said.
Rating company ICRA has graded the proposed bonds a triple-A with stable outlook. Air India Asset Holdings is obtaining another rating.
05/08/19 Saikat Das/Mihir Mishra/Economic Times
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