No Bidders For Air India Yet As Deadline Ends Today

No Bidders For Air India Yet As Deadline Ends Today

The Union government has not received any bids so far for its stake in state-run carrier Air India, aviation secretary RN Chaubey said on Wednesday, a day before the formal bidding process closes.

The government will not extend the deadline for submissions of interest in Air India, Choubey said.

The aviation secretary further added that the government meant to signal to the market that complete freedom would be given to the buyer of Air India, but said he could not comment on whether the end of 2018 would continue to remain the target for the stake sale. "Further course of action will be decided appropriately", the Ministry of Civil Aviation said after the deadline for sending bids passed. EY is the transaction adviser to the government for strategic disinvestment.

On May 1, the government clarified its stand on over 160 queries it received from the interested bidders over the disinvestment of Air India and its subsidiaries. The national carrier's debt burden was about Rs 50,000 crore at the end of March 2017.

On Tuesday, the CBI named AirAsia India, its officials as well as AirAsia Berhad in an FIR for allegedly trying to manipulate government policies through corrupt means to get global licence for its Indian venture.

Experts said the terms of the sale have to be revised to go ahead with the privatization of the loss-making national carrier. "We are in a better position to understand what the market wants. It is beneficial to buyers that government would take care of half of its debt", said Sinha earlier.

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Air India, at the time of putting its business on sale, made it clear that victor should not merge the airline with an existing business as long as government holds a stake in it. He indicated that there could be a rethink on the disinvestment strategy.

One key concern of investors was the level of management flexibility available to them with the government retaining 24% stake and all attendant shareholder rights available to it under law, rather than opting to remain as a minority financial investor. He asserted that the government will ensure that the airline does not face "any operational difficulties following the latest developments".

The government had earlier extended the deadline to receive initial bids for 76 per cent stake sale from May 14 to May 31.

In April, several media reported that Jet Airways ruled out a bid for Air India.

Civil aviation secretary Rajiv Nayan Choubey and senior ministry officials were seen meeting at the secretary's chamber and frequently coming out to make calls. Air India has struggled to deal with competition from the private sector, thereby, increasing the bailout pressure on the government constantly over the years.

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