All eyes on Air India EoI on Monday, likely suitors are Tatas, Hindujas | WeForNews | Latest News, Blogs All eyes on Air India EoI on Monday, likely suitors are Tatas, Hindujas – WeForNews | Latest News, Blogs
Connect with us

Business

All eyes on Air India EoI on Monday, likely suitors are Tatas, Hindujas

Industry sources said that some of the potential bidders could be Tata Group, Hindujas, IndiGo, SpiceJet and a few private equity firms.

Published

on

airindia-wefornews

New Delhi, Jan 26: As the government is set to invite preliminary bids from potential investors for selling 100 per cent stake in Air India on Monday, all eyes are on the portion of airline debt to be taken off its books and qualification for suitors.

Prospective buyers would have to respond to the Expression of Interest (EoI) by March 17, 2020.

Industry sources said that some of the potential bidders could be Tata Group, Hindujas, IndiGo, SpiceJet and a few private equity firms.

Some of the foreign airlines could tie up with local players to place their joint bids.

While overall economic environment remains subdued, industry analysts said that there would be significant investor interest for Air India given its wide domestic and international network, traffic rights, slots at key foreign airports such as London and Dubai, technical manpower and large fleet.

“Besides, the government is ready to go the extra mile to sell off the airline. The government has hinted that it will agree to the demands of potential buyers as it is determined to completely exit the airline business,” said Rajan Mehra, CEO of Club One Air and former India head of Qatar Airways.

Air India is currently bleeding heavily with average daily loss pegged at Rs 20-25 crore. The Modi government is not keen to give any further financial support to the airline and has announced to shut it down if the second disinvestment bid fails.

As per official data, Air India had an operating revenue of Rs 25,509 crore in FY19. As its operating expense during the fiscal was Rs 30,194 crore, the airline had an operating loss of Rs 4,685 crore. On a net basis, its loss was a record high at Rs 8,556 crore (provisional) in the previous financial year.

Air India has a fleet of 125 aircraft and its domestic market share is 11.9 per cent as on December, 2019.

The Modi government had invited the EoI in 2018 to sell 76 per cent stake in the airline but it ended up being a no-show with not a single private firm expressing interest.

Learning from its previous experience, the government has decided to sell its entire 100 per cent stake in the airline. It is also learnt to have sweetened the deal by removing a large part of its Rs 60,000 crore debt and clearing other liabilities.

“We expect significant interest as the Government of India (GoI) has structured a very attractive offer,” said Kapil Kaul, CEO (South Asia) of Sydney-based Centre for Asia Pacific Aviation (CAPA).

While many industry veterans are bullish on investor interest for Air India, some of the sector experts said that it may not be easy given the current business environment globally.

“The global growth forecast has been downgraded. India has seen its GDP growing at slowest pace in the last over six years. The fuel and foreign exchange situations are not great either,” said an expert wishing not to be named.

He, however, added that it is a do-or-die situation for the government as it can no longer infuse money into an airline which is losing Rs 25 crore a day.

An industry insider said that IndiGo is one of the strong contenders for Air India but given the fighting between its co-founders it will be difficult to get shareholders’ approval for placing the bid.

“Initial bids can be placed but before signing binding agreement shareholders’ approval would be required,” said the insider.

(Nirbhay Kumar can be contacted at [email protected])

Business

Govt must tell forward plan to the country: Congress

Applicable from Monday, June 1, the fresh order issued by the Ministry of Home Affairs (MHA) spoke of the expanded fresh guidelines a day ahead of the end of lockdown 4.0.

Published

on

Randeep Surjewala

New Delhi, May 31 : On the last day of the lockdown 4.0, the Congress has questioned the government on its strategy and plan to control the coronavirus infection, exit route out of the lockdown to revive the economy and a way forward.

Chief Spokesperson of the Congress, Randeep Surjewala said, “Today, we witnessed biggest ‘Single Day Spike’ in #COVID19 infection of 8,380. Total Infection at 1,82,490.”

He asked, “The fifth Lockdown begins tomorrow and Congress posed 4 questions to the government — What is the Govt strategy? Have the Lockdowns failed? Is there a blueprint to fight Corona? Any plan out of economic havoc?”

The party has been questioning the persistent lockdown without any exit plan which was implemented on March 25.

The Centre on Saturday took an exit step from the 68-day nationwide lockdown, declaring that the restrictions will be limited to only containment zones up to June 30 and that the prohibited activities will be opened in a phased manner in areas outside these zones.

Applicable from Monday, June 1, the fresh order issued by the Ministry of Home Affairs (MHA) spoke of the expanded fresh guidelines a day ahead of the end of lockdown 4.0.

The nationwide lockdown was imposed on March 25 with the announcement of the restrictions by Prime Minister Narendra Modi to contain the spread of COVID-19 pandemic. The lockdown was extended thrice earlier.

Continue Reading

Business

Trump to include India, Russia, Australia, S.Korea in G7

Published

on

By

Donald Trump

New Delhi/Washington, May 31 : US President Donald Trump has decided to postpone the G7 summit till September and invite India, Russia, Australia and South Korea to discuss a plan on how to deal with the future of China among the 11 most powerful nations.

A White House statement said that after Air Force One touched down at Joint Base Andrews on Saturday night, the President came back to the press cabin to chat, off the record, for several minutes toward the end of the flight.

However, he permitted the White House to use his statement on the record about the G7.

“He is postponing it until September and plans to invite Russia, South Korea, Australia and India,” the statement said.

President Trump took the decision saying: “I don’t feel that as a G7 it properly represents what’s going on in the world. It’s a very outdated group of countries.”

The Group of Seven (G7) is an international inter-governmental economic organization of the seven largest advanced economies of the world comprising the US, Canada, UK, France, Germany, Italy and Japan.

The decision to postpone the G7 meeting and include four other nations, “is bringing together our traditional allies to talk about how to deal with the future of China”, White House Director of Strategic Communications Alyssa Alexandra Farah said.

Incidentally, India and China are locked in an intense face-off along the Line of Actual Control (LAC) in Eastern Ladakh. Even as President Trump has offered to arbitrate between the two sides, both China and India are using the established mechanisms and communications channels to resolve the issue.

Last week, however, with its new vision document on China, the US announced the onset of its Cold War with the Asian giant, accusing it of exploiting rule-based world order and re-shaping international system in favour of Chinese Communist Party’s (CCP) ideology and interests.

Just short of calling it Cold War, the US in its report titled, ‘United States Strategic Approach to the People’s Republic of China’, released by the White House, declared that it is “responding to the CCP’s direct challenge by acknowledging that the two major powers are in a “strategic competition and protecting” their “interests appropriately”.

On Friday, the US, the UK, Australia and Canada jointly reprimanded China, stating that its decision to impose a new security law on Hong Kong was in direct violation of international treaties.

Continue Reading

Business

Centre allows movement of persons and goods across borders from June 1

The MHA emphasised that no state/UT shall stop the movement of any type of goods/cargo for cross land border under treaties with neighbouring states.

Published

on

By

Truckers

New Delhi, May 30 : The Centre on Saturday, while announcing the guidelines for phased re-opening of the lockdown, said that from June 1, there will be no restriction on inter-state and intra-state movement of persons and goods.

In an exit mode from the 68-day nationwide lockdown, the Centre said that restrictions will be limited to only containment zones up to June 30. Applicable from Monday, June 1, the fresh order issued by the Ministry of Home Affairs (MHA) said, “There shall be no restriction on inter-state and intra-state movement of persons and goods. No separate permission/ approval/ e-permit will be required for such movements.”

The MHA emphasised that no state/UT shall stop the movement of any type of goods/cargo for cross land border under treaties with neighbouring states.

However, if a state/ Union Territory based on reasons of public health and its assessment of the situation proposes to regulate movement of persons, it will give wide publicity in advance regarding the restrictions to be placed on such movement, and the related procedures to be followed.

The MHA said, “Movement by passenger trains and Shramik Special trains; domestic passenger air travel; movement of Indian nationals stranded outside the country and of specified persons to travel abroad; evacuation of foreign nationals; and sign-on and sign-off of Indian seafarers will continue to be regulated as per the SOPs issued.”

Continue Reading
Advertisement

Most Popular