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A-I divestment process set to gain momentum

The divestment process of Air-India is set to gain momentum in the next four weeks with bidders, who have not identified their partners as yet, having to complete the exercise by February 9.

Air-Sabena consortium is among the short-listed bidders along with Tata-Singapore Airlines, Hindujas, Emirates, Air France-Delta and Laxmi Mittal-Kotak Mahindra with British Airways and Qantas acting as technical advisors.

Air-India has set up a data room to which the companies shortlisted would be allowed to access to carry out further due diligence exercise.

While Tatas have Singapore Airlines as their strategic partners others have not identified their Indian partner as yet. Hindujas, who are bidding for Indian Airlines also, have said they are talking to two-three airlines and finalise the airline shortly.

The government had last week given bid packs to the qualified interested parties containing information memoranda, initial draft shareholders agreement, initial draft share purchase agreement and request for proposal.

The issue of bid packs takes the strategic sale further and the bidders have also been asked to finalise the consortium, if they have not finalised consortia already, and to give their details, source of funds and also for submission of technical bids, aviation sources said.

The sources indicated that on receipt of the response from the bidder, further shortlisting would be undertaken by screening of initial technical bids, including security clearance.

The sources said after a week or 10 days of access, these companies would be asked to submit their final technical bid.

Based on technical evaluation and companies found to be suitable as per the norms laid down by the government, financial bids would be invited.

The strict adherence to schedule of activity thus far by the divestment department should see the process of Air-India divestment completed by May this year, the sources added.

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