Air India Back With Tata Group, Government Confirms

1 Oct, 2021 12:32 IST|Sakshi Post
Image Source: Twitter

Air India Back With The Tata Group | Tata Sons Ltd has won the bid for the debt-laden state-run airline Air India. In a statement released on Friday the Central Government approved the winning bid of M/s Tata Sons’ SPV (M/s Talace Pvt Ltd) for AIr India disinvestment at an enterprise value of ₹18000 crore. The bid by the consortium led by Ajay Singh was ₹15,100 crore.M/s Talace Pvt Ltd emerged as the successful bidder for the sale of equity shareholding of Government of India in Air India and AI's shareholding in AIXL and AISATS along with management control.

The Letter of Intent (LOI) will be issued and the Share Purchase Agreement (SPA) will be signed with the successful bidder. After regulatory and other approvals, the transaction is expected to close by December 2021.

Non-core assets including land and buildings with book value of ₹14,718 crore will not be given to the acquirer but will be transferred to GoI's Air India  Assets Holding Limited (AIAHL).

The Tatas which also control Jaguar Land Rover and have a majority stake in AirAsia India,  had submitted a bid for Air India earlier last month.  The other bidder was SpiceJet Ltd. owner Ajay Singh. A panel of ministers accepted a proposal recommending Tata Sons's bid.

Air India incurs a loss of Rs 20 Crore on a daily basis and this has led to an accumulation of Rs 70,000 crore loss to the government.

The government had tried to auction a majority of the stake almost three years ago, but there were no bidders.

The auction was also announced several times and the deadline was extended even despite the pandemic.

As per reports, Air India has some lucrative assets, including valued slots at London’s Heathrow airport, a fleet of more than 100 planes and its trained pilots and crew.  Air India Express and its 50 percent stake in AI-SATS, the ground handling company will also be part of what the group will get as part of the takeover.

Air India was originally called Tata Airlines and was established in 1932 by the legendary industrialist and philanthropist J.R.D. Tata, who was also India’s first licensed pilot.

It was nationalized around the time of India’s independence in 1947.

Initial media reports indicating approval of financial bids by the Government of India in the AI disinvestment case were first stated as incorrect. Media will be informed of the Government's decision as and when it is taken, tweeted the Secretary, Department of Investment and Public Asset Management earlier.

Also Read: India's Pride: Meet Four Air India Women Pilots Who Flew World’s Longest Air Route

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