Associate Partner

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.

The Great Diwali Discount!
Unlock 75% more savings this festive season. Get Moneycontrol Pro for a year for Rs 289 only.
Coupon code: DIWALI. Offer valid till 10th November, 2019 .

Updated Date: Nov 27, 2018 19:15:29 IST