New Delhi- As per the report, Tata Group and SpiceJet promoter Mr. Ajay Singh has been selected for the bid to buy out Air India.
However, the two now need to submit their financial bids after the completion of due diligence on the national carrier’s books, agreements, and liabilities. However, in their financial bids, the parties need to state the quantum of AI’s debt which they will be willing to take up, and the upfront payment that they are making for the asset. Moreover, whoever’s quotes will be the highest in the economic value for AI will be declared the winner of the bid.
Almost 15% of the AI’s enterprise value needs to be paid in cash whereas the balance can be paid as debt. Well, it is found that AI has a debt of more than Rs 90,000 crore. Approximately, the national carrier will report around Rs 10,000 crore loss this fiscal.
It is found that Tata Group will be putting in its bid through AirAsia India which holds the controlling stake. On the other hand, Singh has firmed up strategies with the Middle East sovereign fund for procurement.
In 2014, Singh created the famous slogan “ab ki baar Modi Sarkaar” in the general election and his spokesperson didn’t offer a single comment on the report.
According to the latest update it is found that Tata Group is now wooing its Southeast Asian full-service carrier partner Singapore Airlines to join the board for the AI bid. Singapore Airlines and the conglomerate runs the Vistara in India. However, Singapore Airlines has shown less interest in AI because the Covid-19 pandemic has created a greater impact on the balance sheet. Thus, it is assumed that AI is more likely to go to the Tata Group.
Well, India’s largest conglomerate that owns Jaguar Landrover, which was first established AI in 1932 but its interest was sold to the government in 1953. Moreover, the AI group bid refers to the commitments to the air transport businesses. The acquirement will soon ramp up its ambitions of emerging a significant player in the aviation sector.
Notably, the government hopes to complete the AI divestment almost by the second quarter of the next fiscal. Moreover, it is expected that the government will soon handover the AI winner in the initial transition time frame when they antedate trouble from other stakeholders and unions.