The government has extended the deadline to bid for Air India by two months till June 30, as the Covid-19 fallout has disrupted economic activity globally. This is the second extension in the deadline to submit bids by investors for Air India since it initiated the process of stake sale in the debt-ridden national carrier on January 27.
Issuing a corrigendum to the Expression of Interest for sale of Air India, the Department of Investment and Public Asset Management said the deadline has been extended in view of the “request received from the IBs (interested bidders) in view of the prevailing situation arising out of Covid-19”.
While issuing the EoI in January, the last date for bids was kept for March 17, which was later extended to April 30. This has now been further extended till June 30. Also, the date for intimation to qualified interested bidders (QIB) has been extended by 2 months till July 14, the DIPAM said in the corrigendum posted on its website.
“Further changes with respect to the Important Dates, if any, will be communicated to the Interested Bidders subsequently,” it added.
The pandemic has disrupted economic activity with many countries announcing lockdown to contain the virus spread.
The aviation sector has been hit hard by Covid-19 with airlines cancelling international flights and announcing pay cuts for employees.
The extension of Air India bid deadline followed the government’s move last month to extend the time given to investors to bid for its entire 52.98 per cent stake in Bharat Petroleum Corp (BPCL) to June 13. The earlier deadline was May 2.
After its unsuccessful bid to sell Air India in 2018, the government in January 2020 restarted the divestment process for Air India and invited bids for selling 100 per cent of its equity in the state-owned airline, including Air India’s 100 per cent shareholding in AI Express and 50 per cent in Air India SATS Airport Services.
In 2018, the government had offered to sell its 76 per cent stake in the airline. Of the airline’s total debt of Rs 60,074 crore as of March 31, 2019, the buyer would be required to absorb Rs 23,286.5 crore, while the rest would be transferred to Air India Assets Holding, a special purpose vehicle.
For the current fiscal, the budget has pegged disinvestment proceeds at Rs 2.10 lakh crore. This includes Rs 1.20 lakh crore from CPSE share sale and Rs 90,000 crore from share sale in public sector banks and financial institutions, including listing of insurance behemoth LIC.
Source: Business-Standard