The state-run carrier Air India which has been on the market for quite some time now, has recently got its final bids by Tata Sons and SpiceJet promoter Ajay Singh. As per report by Business Standard, the winner of the bid is likely to be selected by the government in approximately three weeks.
Further the report added that two high-level committees will decide the reserve price for the national carrier within this period. This will be one of the final steps in the Air India divestment process, following which the government will plan to complete the transaction by December.
Based on the government appointed valuers inputs, the reserve price of the airline will be decided by an inter-ministerial group (IMG) headed by the secretary of the Department of Investment and Public Asset Management (DIPAM).
Following the IMG’s decision, the Core Group of Secretaries on Divestment (CGD) will take a final call on the reserve price.
To make a decision on who acquire the state-run carrier, crucial evaluation processes are currently underway.
Upon determination of the final reserve price, the proposal will be floated before the Air India Specific Alternative Mechanism (AISAM), which is headed by Union Home Minister Amit Shah. AISAM members include the finance minister, commerce minister and aviation minister.
While the government aims to complete the entire process by December this year, it will depend on whether the government and the winner of the bid are in agreement. It may be noted that the terms and conditions have been finalised with buyers earlier.
Further, the timely approval from the Competition Commission of India (CCI) and the lenders to the national carrier will also be a huge factor affecting the deadline of the deal completion.
Air India had failed to attract a bidder in 2018 when the government floated an offer to sell a 76 per cent stake. However, the government is looking to sell its entire stake in Air India this time.
The offer includes all of Air India and Air India Express and a 50 per cent stake in the ground handling capacity of AISATS.