3 min read.Updated: 14 Dec 2020, 04:42 PM ISTRhik Kundu
The bid proposes 51% stake to Air India employee association, which includes about 219 employees as part of the consortium, and 49% stake to Interups Inc, according to Laxmi Prasad, chairman of Interups Inc.
New Delhi: A section of Air India Ltd's employees along with New York-based company Interups Inc. will be placing an expression of interest (EoI) for the divestment-bound national carrier, ahead of the deadline for the bid on Monday.
The bid, jointly made by Interups Inc. and Air India's employee group, proposes 51% stake to Air India employee association, which includes about 219 employees, including board members, as part of the consortium, and 49% stake to Interups Inc, Laxmi Prasad, chairman of Interups Inc., told Mint.
"Willing and continuing employees will be offered 51% in the consortium that acquires the airline. No capital investment is required (from them)," Prasad said, adding that if the planned acquisition of Air India was successful, Interups Inc. along with Air India Ltd would sponsor an aviation infrastructure investment trust to monetize certain assets.
"We are actively advocating airline routes, ground handling, training and other facilities into infrastructure placement. This leaves the current company to remain lean and operational," he added.
Laxmi Prasad said that his company, Interups Inc., holds 27,635 qualified retirement asset accounts owned by US based non-residential Indians.
When contacted, an Air India spokesperson wasn't immediately available for comments. A senior Air India official confirmed that about 219 employees of Air India, representing a cross section of employees, including board members, are part of the consortium which, along with Interups Inc., have bid for the national carrier.
Meanwhile, Mumbai-based salt-to-software conglomerate Tata Group is likely to submit an expression of interest (EoI) for national carrier Air India Ltd before the deadline on Monday.
According to news reports, the Tata Group is seeking to pursuade its partner, Singapore Airlines, with whom it operates a joint venture—Vistara—to waive off a non-compete clause in the agreement to bid for Air India and also to partner the conglomerate in its bid for the country's national carrier.
Meanwhile, the last date for the submission of expression of interest (EoI), which has been extended several times this year, currently stands at 14 December.
The qualified institutional bidders, if any, will be invited to start bidding for the airline from 28 December, according to the latest government corrigendum.
The government, this time around, plans to divest 100% of its equity share capital in Air India Ltd, which includes Air India’s shareholding interest of 100% in AI Express Ltd and 50% in Air India SATS Airport Services Pvt. Ltd.
The government had earlier failed to attract any bid for the national carrier, after putting up 76% of the airline two years ago. However, this time around, selling the airline may be a challenge amid the covid-19 pandemic, which has adversely affected the aviation sector.
However, in order to facilitate the sale of Air India Ltd, the government in October this year decided not to predetermine the national carrier's debt level and left it to the market to decide.
Air India has current liabilities and provisions, including short-term loans and trade payables, of ₹70,686.6 crore and had a net debt of ₹58,255 crore at the end of FY 19. However, the government has transferred ₹29,464 crore of this debt from Air India to a government-owned special purpose vehicle, Air India Assets Holding Ltd.
The Department of Investment and Public Asset Management (DIPAM), the arm of the finance ministry overseeing the Air India divestment, on Monday said that multiple EoIs for the divestment process were received before the deadline.
"Multiple expressions of interest have been received for strategic disinvestment of Air India. The Transaction will now move to the second stage," DIPAM secretary Tuhin Kanta Pandey said in a tweet on Monday.
While, the last day for submitting EoIs for Air India divestment is on 14 December, the DIPAM will now evaluate the bids and make known the ones that qualify, a fortnight later, according to the department's proposal to privatize the national carrier.
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