- Air India had a total debt of $8.4 billion
- The airline posted a loss of $1.2 billion last year
- The buyer will only have to take care of $3.26 billion debt
Air India is to be put on the block with the 100% stake in the airline up for sale. Although on a first look, the deal might look attractive for the buyers, on looking around that is certainly not the case given the financial health of the airline. The government of India is also putting in the effort to make the stake sale attractive for the buyers. The first step in this has been the reduction of debt. However, this is not the only thing that Indian government officials have done to increase the chances of Air India stake sale. The Indian officials have also met with the major airlines who can be the takers for Air India.
Officials Meet Multiple Carriers to Talk About Air India Sale
As per the officials aware of the matter, ThePrint reported that the Indian officials met with airlines like British Airways and its parent entity, IAG SA, and it also met with the India based low-cost carrier, IndiGo which is owned by InterGlobe Aviation. After this, the officials from the Indian Government have also been said to meet SpiceJet and Tata Sons. While SpiceJet is another low-cost carrier in India ranking below IndiGo, Tata Sons is the holding company of Vistara and AirAsia India with 51% stake in each. What’s interesting to note is that Air India was started back in 1942 by JRD Tata but was later acquired by the Indian Government.
Government Reduces Debt of Air India
The major hurdle for the buyers of the airline will be the loss-making situation of the carrier. Last year, Air India posted its highest ever loss of $1.2 billion last year. In addition to this, Air India also had $8.4 billion of debt on its shoulder to carry. But, for the purpose of the sale, the debt of the airline has been reduced to $3.26 billion mostly related to aeroplane orders. Also, the buyers of the airline would get the priced slots at the London Heathrow airport, an army of trained pilots, and over 100 planes that form the fleet of Air India.
Whenever Arpit boards a plane he is filled with awe and bewilderment and soaring above the skies is something marvellous for him. An aviation and tech geek through and through Arpit writes at AviationScoop not only because he's experienced and good at his craft but also because flying is something which makes his heart flutter with joy.