Mumbai-based conglomerate Tata Sons will take over the loss-making national carrier Air India, the Centre announced Friday as it looks to close one of its most ambitious disinvestment projects.The Tata Group placed a winning bid of Rs 18,000 crore. Along with the assets, the new owner will also take on around Rs 15,300 crore of debt, Secretary, Department of Investment and Public Asset Management Tuhin Kanta Pandey said. The remaining Rs 2,700 crore will be paid to the government in cash.Pandey said that the process is expected to be closed by December this year.While this kicks off the NDA government’s mega privatisation plans, it would mean the government ceding 100% stake in the airline that it nationalised in 1953, taking over control from the Tata Group.
The financial bids that were placed last month saw Tata Group outbidding SpiceJet promoter Ajay Singh, who bid in his private capacity. The Ajay Singh consortium bid Rs 15,100 crore.
Representatives of both bidders were called for meetings on two occasions earlier this month, during which the share-purchase agreement was discussed to help them take a long-term view of Air India’s various liabilities, and plan the funding accordingly.
The decision has been ratified by the Air India Specific Alternate Mechanism, a group of ministers headed by Home Minister Amit Shah that was constituted to take a decide on the airline’s disinvestment. In addition to the home minister, the AISAM comprises Finance Minister Nirmala Sitharaman, Commerce Minister Piyush Goyal and Civil Aviation Minister Jyotiraditya Scindia.
Surjitt Sahani
