Monday, October 14, 2019

Air India privatisation: Govt to make national airline debt-free before sale

New Delhi: The Centre will likely make the ailing Air India (AI) virtually debt-free by taking over an additional Rs 20,000 crore from its books before offering it afresh to bidders by the end of this month.
The government had taken over Rs 29,464-crore of AI debt earlier this financial year through a special purpose vehicle (SPV). AI’s assets, largely its fleet of aircraft, are estimated to be about Rs 20,000 crore, equivalent to the residual debt to be taken over by the prospective buyer, along with the entire government stake in the airline.
As on March 31, 2019, AI’s debt and other liabilities had stood close to Rs 70,000 crore.
With the debt overhang over, the much-anticipated AI privatisation might materialise this year and contribute a substantial amount to the Centre’s disinvestment receipts. The premium bilateral rights owned by the national carrier are what the prospective buyer will have to really pay for.
AI’s assets include a fleet of 128 aircraft and its valuable bilateral flying rights, landing rights and parking slots at airports across the world. Air India owns 70 planes, including wide-body Boeing 787-800 Dreamliners, and the remaining planes are on lease.
14/10/19 Prasanta Sahu and Arun Nayal/Financial Express

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