IPOs of AI, Indian to be delayed: Patel

New Delhi, Apr 21 (UNI) The planned initial public offerings by government-owned airlines Indian and Air India have been deferred till the government decides on their proposed merger, Minister for Civil Aviation Praful Patel said today.

''We wanted to complete the IPO processes in the first half of this year. But there is a suggestion that there may be better valuation of a merged entity,'' he told reporters at an industry meet here.

On April 4, Mr Patel had said the government has given in-principle approval for the merger of AI and Indian and the process will be completed this year itself.

Officials say that ahead of the merger, the government needs to consider several issues including rationalisation of routes operated by the two airlines. At present, Air India and Indian both operate flights to several global destinations in the Middle East and the Far East including Bangkok, Malaysia and Singapore.

Besides, the decision on which airline would be taken over by whom and the fate of the subsidiaries -- Alliance Air and Air India Express -- need to be resolved. Both airlines also need to decide how best to utilise their existing manpower.

The Ministry of Civil Aviation recently made a presentation to Prime Minister Manmohan Singh on the proposed merger.

Officials say the merger would create a monolith that would be better positioned to take on global competition. Besides, with Air India keen on joining a global aviation alliance, the merger could provide additional benefits to passengers including access to far-flung areas of the country currently not served by any domestic airline.

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