Govt to proceed with sale of Air India ground handling subsidiary AIATSL with 100% divestment

Aviation secretary, RN Choubey said that Air India's ground handling operations will be transferred to Special Purpose Vehicle (SPV)

Press Trust of India November 27, 2018 18:36:23 IST
Govt to proceed with sale of Air India ground handling subsidiary AIATSL with 100% divestment

New Delhi: A ministerial panel Tuesday cleared a proposal for strategic sale of Air India's ground handling subsidiary AIATSL, an official said.

The approval comes amid the government working on ways to revive the fortunes of Air India -- estimated to have debt burden of more than Rs 50,000 crore --, including sale of non-core assets.

"The Alternative Mechanism has approved EoI (Expression of Interest) together with Preliminary Information Memorandum for Air India Air Transport Services Limited (AIATSL) sale,” an official told reporters in New Delhi.

Proceeds from the sale of AIATSL would be used to pay-off part of Air India's debt.

Govt to proceed with sale of Air India ground handling subsidiary AIATSL with 100 divestment

Representational image. Reuters.

The Alternative Mechanism on Air India disinvestment, headed by Finance Minister Arun Jaitley, has decided to proceed with strategic sale through divestment of 100 percent ownership of AIATSL, the official added.

The meeting here was attended by Jaitley and Civil Aviation Minister Suresh Prabhu, among others.

The sale would happen after transferring AIATSL to a Special Purpose Vehicle (SPV), which has already been incorporated, the official said.

The EoI document would be issued after transfer of AIATSL to the SPV.

In 2016-17, AIATSL raked in a profit of Rs 61.66 crore.

AIATSL was incorporated in June 2003 with the objective of carrying out the business of providing all types of services at airport. Industrial and business operations of AIATSL include rendering airport ground handling services such as those pertaining to passenger, ramp, security and cargo for Air India.

The latest strategic sale plan follows the decision by the ministerial panel in June to make Air India competitive, by way of cutting down debt and raising resources by selling land assets and other subsidiaries.

The ministerial grouping had decided to revive Air India after the government's strategic stake sale offer failed to attract any bidders earlier this year.

The government had originally proposed to offload 76 per cent stake in the national carrier as well as transfer the management control to private players.

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 to privatise Air India in phases; Qatar Airways, IndiGo refute reports about a joint bid
Business

Govt to privatise Air India in phases; Qatar Airways, IndiGo refute reports about a joint bid

Government is planning to conduct disinvestment process of Air India group in phases and a EoI will be issued for each entity under the corporation

Air India's international operations main attraction for IndiGo
Business

Air India's international operations main attraction for IndiGo

The international operations of Air India seems to be the main attraction for IndiGo, which has also flagged concerns about some foreign overseas airlines being allowed "disproportionate access" to the Indian market.

Air India divestment: Govt unsure if it can sell the ailing carrier; civil aviation secretary RN Choubey's take a case of sour grapes?
Business

Air India divestment: Govt unsure if it can sell the ailing carrier; civil aviation secretary RN Choubey's take a case of sour grapes?

A non-airline company, with no experience in running an airline, can also place a bid for Air India. This shows all that is wrong with the divestment.