Air India to be split into four entities before sale: Report
The proposed privatisation of Air India Ltd has gained momentum, with the government deciding to break the airline into four units and offer to sell at least 51% in each of them as part of a disinvestment plan.
The debt-laden national carrier would be divided into core airline business, regional arm, ground handling and engineering operations, a report by Bloomberg said.
The core airline business comprising Air India and Air India Express, the low-cost overseas arm, will be offered as one company, and the process will be completed by the end of 2018, Bloomberg reported, quoting Junior Aviation Minister Jayant Sinha.
"The aviation sector is a very fast growing sector, with really exciting opportunities for all participants, so we felt all of this will unlock growth and competitiveness of Air India group," Sinha said. "We expect it to be a very bright future for its employees."
Earlier last week the government had cleared a proposal to allow foreign investors to own up to 49 per cent in the carrier. The government had also cleared that the national carrier's substantial ownership would remain with Indian nationals.
Air India had total debt of about Rs48,877 crore at the end of March 2017-Rs17,360 crore of aircraft loans and Rs31,517 crore of working capital loans. Various efforts were made to improve the financial performance of the airline, including by way of sale of non-core assets.