Economy

Govt Puts Debt Laden Air India for Sale: Who will Buy?

Govt Puts Debt Laden Air India for Sale: Who will Buy?

Beleaguered Air India is ready to be sold as it has got the approval from the cabinet few days back. Civil Aviation Minister A.G. Raju says that it won’t be an easy job for the government to sell AI. Here is why he thinks so.

A Saga of Mismanagement and Losses

Since years the Premiere Air service Company Air India has landed into mismanagement, corruption and loss. Presently the company is in debt of 46, 570 crore rupees and is running on steroids of 30, 231 crore rupees by the government. Modi Government is in no mood to continue Air India for long and has made it clear to sell AI. Air India has seen loads of corruption and mismanagement over the years and is still unable to cope up with this. Earlier also it was next to be sold but somehow it didn’t happened.

Who will Buy Air India?

Hardly any private company has shown interest in buying Air India. Tata and Spice Jet have shown some interest but no formal proposal has come from them till now. We can witness history if AI is sold to Tata as it was previously handed over to the government by Tata. AI is a big company that holds much ground all around and has big employee turnaround. With huge debt and mismanagement, no private company wants to take such a risk of buying Air India. Reasons that can lure them is AI has many key properties in key areas. Apart from flights, AI also has many other areas of operation like MRO, Centaur Hotels, and Air India SATS.

 Apart from these, AI has key slots, parking, market share, and land revenues, properties in metros and foreign lands that may lure the buyers. Still, operating AI will be full of challenges for the new buyer. The government may soon form a committee of Group of Ministers to deal will AI issue from finding a right buyer to negotiating with the buyer to finalizing a deal and selling it at a reasonable price. A meeting chaired by the Prime Minister approved the selling of Air India likely by the end of FY 2017-18.

2 Comments

2 Comments

  1. Pingback: Disinvestment of Air India: More Than Just Revenue

  2. Pingback: Jet Airways Financial Crisis: Another Air India In Making?

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Stay updated with latest news on finance, taxation reforms, stocks, currencies, trading, global markets and many more.

Are you finding it difficult to manage your personal finance? Know your best opportunities of investments and savings with expert analysis and latest updates.

Copyright © 2016 Finance Minutes

You agree to not make actual stock trades based on comments on the site, nor on any techniques presented nor discussed in this site or any other form of information presentation. Finance Minutes will not be held liable for any losses you in occur while trading. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. All information is for educational and informational use only. You agree to consult with a registered investment advisor, prior to making any trading decision of any kind.

To Top