Mumbai: Bidders for a majority stake in Air India, which the government wants to divest, will have to eventually take over interest-bearing debt of around Rs16,500 crore, said a person with direct knowledge of the airline’s divestment.

The government had on 28 March invited expressions of interest (EoI) from parties interested in acquiring a controlling stake in Air India.

The government intends to sell a 76% stake in Air India along with a 100% stake in low-cost international airline Air India Express Ltd and a 50% stake in Air India SATS Airport Services Pvt. Ltd, a joint venture firm.

According to the EoI, the buyer of Air India will have to take on a debt of Rs33,392 crore (approximately $5.1 billion). The balance debt shall be allocated to Air India Asset Holding Ltd, which is 100% owned by the government.

“While the total debt being passed on to the new buyer stands at Rs33,392 crore, this headline number includes components such as current liabilities and financial lease. The current liabilities, which stand at Rs8,816 crore, have been incurred in normal course of business and then you have another component of Rs8,000 crore for financial lease of aircraft," said the person cited above, requesting anonymity as he is not authorized to speak with the media.

Financial lease can be terminated to get out of the liability and thus the actual interest-bearing debt a buyer will have to compulsorily honour comes down to around Rs16,500 crore, he said.