Citing an example, the bidder said both United Airlines Holdings and Deutsche Lufthansa AG were profit-making, with United flying to 369 destinations and having a fleet of more than 1,250 aircraft.
Lufthansa is flying to 220 destinations and has 400-plus aircraft. The share price of Delta Air Lines is down from $58 on January 1 this year to $38.36 on Friday closing. The US-based airline has a fleet of 909 aircraft and flies to 325 destinations.
Air India, a loss-making airline, has 103 destinations and, along with Air India
Express, around 146 aircraft. The airline has not made money since the merger of Air India and Indian Airlines in 2007.
Apart from Air India, the government is also looking to sell Air India subsidiary Air India Express and 50 per cent in Air India SATS Airport Services.
Apart from the Hindujas, the Adani group, and US-based fund Interups, the Tata group is expected to make a bid. The government has extended the last date for submitting expressions of interest to April 30 after some entities cited the visa ban till April 15 by the Indian government. This, according to them, is preventing their travel to India for valuation. Another prospective bidder said it might opt out of the process because of the crisis.
“We will take a final call in the last week of April on submitting the EoI,” it said.
The decline in Air India’s valuation is bad news
for the government, which is trying its best to sell the airline after it had to pump Rs 30,000 crore of taxpayers’ money into the airline since 2012.
In order to attract bids, the government has transferred Rs 29,500 crore of Air India’s debt to a special purpose vehicle – Air India Asset Holding, with real estate assets. With this, Air India is left with Rs 23,000 crore of debt. The government is selling its 100 per cent equity in the airline, unlike its offer of 76 per cent in the previous round of sale in May last year.
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