The Centre has begun the process of divesting stakes in two subsidiaries — AIASL and AIESL — of erstwhile national carrier Air India, quoting an official the PTI reported on Monday.
“The Department of Investment and Public Asset Management (DIPAM) has initiated investor meetings and roadshows to gauge interest in AIASL and AIESL. We will soon invite EoIs from interested bidders,” the official mentioned.
A debt-laden Air India was sold to Tata Group in October last year for Rs 18,000 crore. The actual handover to Tatas happened on January 27, 2022. However, four Air India subsidiaries – Air India Airport Services Ltd (AIASL), Air India Engineering Services Ltd (AIESL), Alliance Air Aviation Ltd (AAAL), and Hotel Corporation of India Ltd (HCI) – and other non-core assets, painting and artefacts, besides, non-operational assets were not part of the deal.
These subsidiaries and non-core assets valued at about Rs 15,000 crore have been transferred to an SPV — Air India Assets Holding Ltd (AIAHL).
According to the report, the Centre had then said these subsidiaries and non-core assets of the carrier would eventually be sold off. Towards that goal, DIPAM has initiated the exercise of investor meetings for privatisation of AIASL and AIESL.
As of August last year, Air India had a total debt of Rs 61,562 crore. Of this, the Tata Group took over Rs 15,300 crore liabilities and the rest 75 per cent or around Rs 46,000 crore was transferred to AIAHL.
The government has squared off with Air India debtors its share of pending dues. The government, in current fiscal year, has budgeted to raise Rs 65,000 crore from CPSE disinvestment. So far, it has raised about Rs 25,000 crore.
Meanwhile, Air India last week announced its plans to increase its domestic market share by over 30 per cent and significantly strengthen its international operations in next five years. The airline is putting in place a transformation plan after gathering feedback from employees.
Air India, which plans to induct 30 new wide-body and narrow-body aircraft, on Thursday unveiled ‘Vihaan.AI’, a comprehensive transformation plan with a detailed road map for next five years.
According to the plan, focus will be on dramatically growing both its network and fleet, developing a completely revamped customer proposition, improving reliability and on-time performance (OTP), and taking a leadership position in technology, sustainability, and innovation, as well as aggressively investing behind the best industry talent, the company said.