Finally, great news for Tata Son’s has won the bid for national carrier Air India.
According to confirmed sources that Tata Sons is the bidder’s frontrunner. “The Tata group has made the highest bid for Air India.” According to the source, the winning bid will be announced in the coming days.
Tata is the frontrunner and ahead of Spicejet.
Both bidders’ representatives were summoned to meetings earlier this week, there was discussion on a share purchase agreement which helped them take a long-term view of Air India’s various liabilities and plan to fund accordingly.
According to multiple sources, the government is planning to close one of its most ambitious disinvestment projects.
The winning bid is expected to be ratified by the Air India Specific Alternate Mechanism (AISAM), a group of ministers led by Home Minister Amit Shah.
There will be two levels of political clearance.
The Union Cabinet, led by Prime Minister Narendra Modi, must then approve the proposal. These approvals are merely formalities, and will soon receive permission from the government.
Tata Group may be willing to buy up to 15% of the airline’s total debt.
While the sources did not specify the terms under which the Tata Group might be willing to buy up to 15% of Air India’s debt, they mention that it is a big topic of discussion between the government and the Tata Group.
The government said it would sell 100 percent of its stake in Air India, up from 76 percent previously. It was a significant change from the government’s previous attempt to sell Air India in 2018.
The stake sale includes Air India’s entire stake in AI Express Ltd and a 50% stake in Air India SATS Airport Services Private Ltd.
The winning bidder must pay the government at least 15% of the quoted enterprise value in cash, with the remainder taken on as debt.
Tata Group’s international operations will benefit from 1,800 international landing and parking slots at domestic airports, along with 900 slots at international airports, in addition to 4,400 domestic slots.
The Tata Group founded Air India in 1932, and it was nationalized in 1953. The group previously expressed interest in acquiring the airline on several occasions, including in 2001 with Singapore Airlines.
However, the bid was withdrawn at the last stage due to a variety of factors. In 2015, the Tata Group also formed a 51:49 joint venture with Singapore Airlines to launch an airline.
In addition, the group owns 83.67 percent of the low-cost airline AirAsia India.
The international service was one of India’s first public-private partnerships, with the government owning 49 percent, the Tatas 25 percent, and the public admit the rest.