Air India plans to sell four subsidiaries; headquarter building in Delhi, other land assets

Air India, which has been in the red for long, had a debt burden of Rs 48,000 crore at the end of March 2017.

Press Trust of India September 17, 2018 07:16:34 IST
Air India plans to sell four subsidiaries; headquarter building in Delhi, other land assets

New Delhi: The government plans to soon initiate the strategic sale process for at least four subsidiaries of loss-making Air India, including Airline Allied Services Ltd (AASL) and Hotel Corporation of India (HCI), according to officials.

Besides, plans are on the anvil for selling the headquarter building of Air India in the national capital as well as various other land assets and buildings of the airline in different parts of the country.

The government has prepared a list of the airline's assets that could be hived off as part of the strategic sale plan for Air India and its subsidiaries, officials said.

According to them, the disinvestment process is likely to be initiated soon for four Air India subsidiaries —AASL, HCI, Air India Air Transport Service Ltd (AIATSL) and Air India Engineering Service Ltd (AIESL).

While AASL, under the name Alliance Air, provides regional air connectivity, HCI owns and operates two hotels in Delhi and Srinagar, among others.

AIATSL provides ground handling and cargo handling services. AIESL is mainly into maintenance, repair and overhaul of engines.

Apart from the headquarters building, other assets proposed to be sold include Air India properties in Mumbai and Delhi.

Air India plans to sell four subsidiaries headquarter building in Delhi other land assets

File photo: Air India.
PTI pic

Officials said the government also plans to sell various art works and artefacts.

In June, a ministerial panel chaired by Finance Minister Arun Jaitley deferred the strategic sale of the government's 76 per cent stake in Air India. Instead, it was decided that the government would look at sale of assets and subsidiaries of the national carrier to reduce the debt burden.

Air India, which has been in the red for long, had a debt burden of Rs 48,000 crore at the end of March 2017.

The government had originally proposed to offload 76 percent equity share capital of the national carrier as well as transfer the management control to private players. However, the offer failed to attract any bidder when the deadline for initial bids closed on 31 May.

The national airline is staying afloat on a bailout package extended by the previous UPA regime in 2012 and the government is also looking at ways to infuse more funds into the carrier.

For the current fiscal, the government expects to raise Rs 80,000 crore from strategic as well as minority stake sales in public sector enterprises.

So far this fiscal, the government has raised over Rs 9,220 crore by divesting stakes in state-owned companies.

Last year, the government had mopped up over Rs 1.03 lakh crore from PSU disinvestment. This was aided by country's oldest gas producer ONGC's Rs 36,915 crore acquisition of government-owned fuel retailer Hindustan Petroleum.

Updated Date:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Govt does not want Air India to go defunct like Kingfisher Airlines, says Ashok Gajapathi Raju
Business

Govt does not want Air India to go defunct like Kingfisher Airlines, says Ashok Gajapathi Raju

Air India has a debt of more than Rs 52,000 crore and is surviving on a Rs 30,000 crore bailout package extended by UPA govt in 2012

Air India sale: Aviation think tank Capa expects participation from global airlines for national carrier
Business

Air India sale: Aviation think tank Capa expects participation from global airlines for national carrier

Air India represents an attractive opportunity for investors if it is relieved of its working capital debt, which stands around Rs 30,000 crore

Air India sale: With a likely profit of Rs 297 cr, AI Express only shining star among subsidiaries
Business

Air India sale: With a likely profit of Rs 297 cr, AI Express only shining star among subsidiaries

Hotel Corporation of India, AI Engineering Services and Alliance Air remained loss making in 2016-17, according to estimates submitted in Parliament on Thursday