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<keyword id="6356662" type="General" weightage="100" keywordseo="singapore" source="Orion">Singapore</keyword> Airlines' deal with Tata Sons (Tata) will inject a further <keyword id="366395" type="General" weightage="80" keywordseo="sgd" source="Orion">SGD</keyword> 360 million (USD 267 million) into Air <keyword id="3658" type="General" weightage="50" keywordseo="india" source="Orion">India</keyword>. It will give <keyword id="6359180" type="General" weightage="80" keywordseo="sia" source="Orion">SIA</keyword> a 25.1 per cent stake in the enlarged Air India group following its takeover by Tata and merger with <keyword id="2468721" type="General" weightage="50" keywordseo="vistara-airlines" source="Orion">Vistara Airlines</keyword>. The November 2022 deal between Singapore Airlines and Tata Sons to further inject USD 267 million into Air India is one of the key strategic initiatives for future growth mentioned in the quarterly financial report. This agreement is still subject to regulatory approval. SIA in the statement said, "The merged entity will be four to five times larger in scale compared to <keyword id="2467342" type="General" weightage="50" keywordseo="vistara" source="Orion">Vistara</keyword>, with a strong presence in all key airline segments in India. The proposed merger will bolster SIA's presence in India, strengthen its multi-hub strategy, and allow it to continue participating directly in this large and fast-growing aviation market." The airline further said, "Deeper collaboration with like-minded airlines is an integral part of the SIA Group's partnerships strategy. This enables SIA and its partners to drive more traffic to their hubs, offer more options to customers, and increase the Group's global footprint." Last week, Singapore Airlines (SIA) announced that net profit for Q3 which ended in December, came in at Singapore dollar (SGD) 628 million (USD 465 million) and financial year-to-date profits touched SGD 1,555 million (USD 1,152 million). They are the highest the airline has ever earned in a quarter as well as for the first nine months of a financial year. The airlines said in a statement that this is due to "the robust demand for air travel continuing into the third quarter of FY2022/23, building on the momentum that began after Singapore relaxed its border restrictions in April 2022." SIA financial year starts in April. This comes on the back of Singapore's announcement that from February 13, it will relax all remaining Covid restrictions for travellers as well as locals. Travellers who are not fully vaccinated against Covid will no longer need to show proof of a negative pre-departure test before entering Singapore and do not need to buy travel insurance to cover Covid treatment if they fall ill on the island. Those who are vaccinated no longer need to show proof on arrival. The use of a face mask on public transport which was the last remaining local Covid-era protocol is no longer mandatory as of the same date. Singapore was one of the first Asian countries to reopen after the Covid pandemic and that has aided its tourism industry along with its national carrier. Besides government grants to affected industries during Covid, the airline was the beneficiary of its shareholders and financial institutions' confidence in its business as it managed to raise SGD 22.4 billion (USD 16.6 billion) during Covid including SGD 15 billion from shareholders (largest of which is state investment firm Temasek Holdings) through sales of shares and convertible bonds. As of December 2022, it still holds a cash balance of SGD 15.4 billion. This allowed it to keep most of its staff and fleet and facilitated restoration of routes quickly once travel resumed. This was unlike other regional airlines which had to let staff go and sell aircraft to keep afloat.SIA reported that its group passenger capacity reached 80 per cent of pre-Covid levels in December 2022, higher than the average of 51 per cent for the Asia-Pacific region. Its two main airline brands carried 7.4 million passengers in the third quarter, up 17 per cent from the second quarter. When added to the first two quarters, the SIA Group served 18.8 million passengers for the first nine months of the financial year. This is a nine-fold increase from a year earlier (2021) when most of the world's borders were still closed. Passenger load factors for the Group improved by 0.8 percentage points to 87.4 per cent, the highest for any quarter, on the back of record load factors for both premium airline, SIA (87.3 per cent) and low-cost carrier, Scoot (87.8 per cent). SIA reported that its cargo performance moderated compared to the previous quarter due to softening demand, as well as an increase in belly hold capacity as more passenger aircraft returned to service globally. While yields were weaker quarter-on-quarter, they remained elevated -- almost double -- compared to pre-Covid levels. Overall, SIA's revenue for the three months to December rose SGD 358 million (USD 265 million), an 8 per cent quarter-on-quarter increase to SGD 4,846 million (USD 3,589 million), a record. Passenger-flown revenue increased by 14 per cent or SGD 463 million to SGD 3,767 million as traffic grew 12.2 per cent for the quarter, outpacing the 11.1 per cent expansion in capacity. Revenue per available seat-kilometre (RASK) was 10.6 Singapore cents, the highest quarterly RASK in the Group's history. Cargo flown revenue fell 14.1 per cent or SGD 141 million (USD 104 million) to SGD 862 million (USD638 million), with the lower yields which were down 14.6 per cent partially mitigated by a slight uptick in loads, up 0.6 per cent. Expenditure increased 7.4 per cent or SGD281 million (USD208 million) quarter-on-quarter to SGD 4,091 million (USD 3,030 million). This comprised an SGD 371 million (15.5 per cent) rise in non-fuel expenditure that was partly offset by an SGD 90 million decrease (-6.3 per cent) in net fuel cost. The increase in non-fuel expenditure was higher than the increase in capacity, mainly driven by higher foreign exchange losses of SGD 194 million (USD 144 million) recorded at the end of the current quarter with the US dollar weakening 6.1 per cent against the Singapore dollar. Net fuel cost fell to SGD 1,333 million (USD 987 million) mainly due to a 13 per cent drop in fuel prices. This was partly offset by higher volumes uplifted (+USD 103 million) and lower fuel hedging gain (+USD 19 million). SEE ALSO: <a href="https://www.businessinsider.in/business/auto/news/passenger-vehicles-to-continue-driving-auto-sales-in-february-evs-gain-a-stronghold/articleshow/98272857.cms">Passenger vehicles to continue driving auto sales in February, EVs gain a stronghold</a> <a href="https://www.businessinsider.in/business/corporates/news/spicejet-to-raise-2500-crore-fresh-capital-convert-carlyles-debt-into-equity-and-demerge-cargo-biz/articleshow/98270557.cms">SpiceJet to raise ₹2,500 crore fresh capital, convert Carlyle’s debt into equity and demerge cargo biz</a> <a href="https://www.businessinsider.in/business/corporates/news/stock-price-run-up-in-paytm-nykaa-zomato-pb-fintech-delhivery-could-see-large-shareholders-cashing-out-bofa/articleshow/98274102.cms">Stock price run up in Paytm, Nykaa, Zomato, PB Fintech &amp; Delhivery could see large shareholders cashing out - BofA</a>

Singapore Airlines to get 25.1% stake in enlarged Air India group

<ul><li>Venture debt firm <keyword id="9353689" type="General" weightage="100" keywordseo="stride-ventures" source="Orion">Stride Ventures</keyword> sanctioned over ₹1600 crore to over 70 companies across various sectors. </li><li>Strides has diverse investments across sectors such as consumer, fintech, agritech, B2B commerce, healthtech and more. </li><li>Venture debt disbursed in <keyword id="3658" type="General" weightage="50" keywordseo="india" source="Orion">India</keyword> last year stood at $538 million. </li></ul> Venture debt firm Stride Ventures today closed its Stride Ventures India Fund II after raising $200 million. The fund’s portfolio includes startups like CredAvenue (<keyword id="14257101" type="General" weightage="50" keywordseo="yubi" source="Orion">Yubi</keyword>), <keyword id="3030142" type="General" weightage="50" keywordseo="myglamm" source="Orion">MyGlamm</keyword>, <keyword id="12437554" type="General" weightage="20" keywordseo="zepto" source="Orion">Zepto</keyword>, BluSmart and more. Stride said that the new fund saw participation from leading banks, marquee family offices, corporate treasuries, sovereign funds, PE funds, insurance firms and HNIs. "The growing investor trust in the Indian start-up ecosystem provided us with a great opportunity to develop a strong pipeline of deployments that we have utilized across various sectors. Stride Ventures goal is to continue being a preferred lender while developing innovative alternate financing solutions for founders,” said <keyword id="13803875" type="General" weightage="50" keywordseo="ishpreet-singh-gandhi" source="Orion">Ishpreet Singh Gandhi</keyword>, founder and managing partner at Stride Ventures. The fund saw its first close back in August 2021. Strides has diverse investments across sectors such as consumer, fin-tech, agri-tech, B2B commerce, health-tech, B2B SaaS, mobility &amp; energy solutions (EV). It has sanctioned over ₹1600 crore to over 70 companies across these verticals. “The current economic environment has made growing businesses more amenable to debt transactions than ever before, giving India's venture lending industry a chance to grow and evolve,” added <keyword id="1946603" type="General" weightage="50" keywordseo="apoorva-sharma" source="Orion">Apoorva Sharma</keyword>, partner at Stride Ventures. According to an India Venture Debt <a href="https://s3.ap-south-1.amazonaws.com/www.strideventures.in/Stride+Ventures+India+Debt+Report+2022.pdf">Report</a> 2022, the firm released in May, venture debt disbursals stood at $538 million last year. The fund facilitated joint-lending structures with leading banks over three years. It claims to have built innovative alternate financing solutions within venture debt for founders to allocate capital efficiently. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/akasa-air-has-enough-capital-to-induct-72-aircraft-thanks-to-rakesh-jhunjhunwalas-visionary-role-says-ceo/articleshow/93616737.cms">Akasa Air has enough capital to induct 72 aircraft thanks to Rakesh Jhunjhunwala’s visionary role, says CEO</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/india/news/workplace-recognition-and-not-salary-is-top-criteria-for-job-seekers-in-india-report/articleshow/93615940.cms">Workplace recognition, and not salary, is top criteria for job seekers in India: report</a>

Venture debt firm Stride Ventures closes a $200 million fund

<ul><li>Indian Oil threatened to stop supply of aviation turbine fuel to the airline, over unpaid dues.</li><li>Air India’s pilots also threatened the government with mass resignations if they go on with the divestment plan.</li><li>The debt of Air India has ballooned to a massive ₹60,000 crore and is struggling to carry on operations.</li></ul> The troubles of debt-laden Air India do not seem to come to an end. Even as the government is planning to go ahead with its divestment, today yet another state-owned company Indian Oil threatened to stop supply of aviation turbine fuel to the airline, over unpaid dues. BPCL and HPCL too said that they will cut off<a href="https://trak.in/tags/business/2019/10/14/air-india-flights-can-be-cancelled-after-october-18th-these-6-airports-will-be-affected-due-to-payment-crisis/"> fuel supplies unless</a> their bills, running into few thousands of crores, is cleared. This comes two days after the pilots union was enraged with the government’s plan to sell 100% of the national carrier. The pilots threatened a mass resignation if they plan to go ahead with it. Already as many as 120 pilots resigned in protest. In the Budget 2019, the finance minister Nirmala Sitaraman said that they plan to speed up the process of divestment, and is ready to make structural reforms. She also said that they plan to expedite it by October this year, but there has been no major movement. In the meanwhile, the debt of Air India has ballooned to a massive ₹60,000 crore, joining the ranks of state-owned telecom operators BSNL and MTNL who are struggling to carry on operations. This divestment could have brought in a new investor who could have help cut its debt, while providing the government with much-needed revenue as well. As government moves slowly in its planned sell-off, there is little interest from investors as well. In spite of rumours that Tata Group might bid for the airline, the group spokesperson insists that it <a href="https://www.thehindubusinessline.com/economy/logistics/air-india-buy-tata-sons-back-at-the-drawing-board-may-place-bid-soon/article29653782.ece">is speculation</a>. Yet another airline Jet Airways which was grounded in April this year, failed to find a bidder and its case is now with the bankruptcy court. This was in spite of billionaire Hinduja brothers showing interest in it.

Weeks ahead of divestment, Air India faces multiple threats of being grounded

<ul><li><keyword id="6355725" type="ORGANIZATION" weightage="20" keywordseo="tata-group">Tata Group</keyword> Chairman N Chandrasekaran said he will get his team to evaluate a bid for <keyword id="2573" type="CITY" weightage="20" keywordseo="Air-India">Air India</keyword>. </li><li>The once-Tata owned Air India today has a massive debt of ₹58,351 crore. </li><li>Meanwhile, both of Tata’s current airlines – <keyword id="2467342" type="PERSON" weightage="20" keywordseo="Vistara">Vistara</keyword> and AirAsia – reported losses for FY19. </li></ul>One of India’s biggest business conglomerate Tata Group might consider bidding for the struggling Air India. In an <a href="https://timesofindia.indiatimes.com/business/india-business/will-ask-my-team-to-look-at-bidding-for-ai-tata-group-chief/articleshow/71883484.cms">interview with TOI</a>, Tata Group Chairman N Chandrasekaran said that he will get his team to look into the matter. “Ideally it should be a Vistara decision, not a Tata Sons decision. I’m not going to run a third airline (in addition to Vistara and AirAsia) unless we merge. There are issues. I will never say yes or no. I don’t know,” he told TOI. Interestingly, Air India was run by the Tata Group before the Indian government acquired a 49% stake in the airline in 1948. Tata Group to bid on Air India would expand its exposure to the airline industry. Two of its own airlines – Vistara and AirAsia are running in losses. In the financial year ending March 2019, Vistara’s<a href="https://www.business-standard.com/article/companies/vistara-loss-doubles-to-rs-831-crore-amid-tough-operating-environment-119081401877_1.html"> losses</a> doubled to ₹831 crore. Vistara is a joint venture between the Tata group and Singapore Airlines. Meanwhile, <keyword id="86568" type="COMPANY" weightage="20" keywordseo="Air-Asia">Air Asia</keyword> too is struggling to keep up. Its <a href="https://www.financialexpress.com/industry/air-asia-india-losses-rise-five-fold-in-fy19/1719013/">losses</a> amounted to ₹670 crore, almost five times over its losses in the previous year of ₹125 crore. Tata Group runs AirAsia India in a joint venture with Malaysia-based AirAsia Berhad. For FY19, Air India too posted a massive <a href="https://m.economictimes.com/industry/transportation/airlines-/-aviation/air-india-posts-rs-4600-cr-operating-loss-in-2018-19-aims-operating-profit-this-fiscal/articleshow/71136113.cms">operating loss</a> of ₹4,600 crore, while its net loss stood at ₹8,400 crore. Air India, which has been struggling to find a bidder after the government said that it plans to sell 100% stake in it. It has a massive debt of ₹58,351 crore and recently state-owned oil companies <a href="https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/pay-monthly-or-will-cut-fuel-supply-at-6-airports-from-oct-18-oil-companies-to-air-india/articleshow/71525811.cms?from=mdr">sent a letter</a> asking them to pay up dues or they will stop supplying aviation turbine fuel (ATF).

Tatas may look at bidding for Air India even as its two airlines strap on losses

<keyword id="8555" type="General" weightage="20" keywordseo="tata" source="Orion">Tata</keyword> Group’s takeover of loss-making national carrier <keyword id="2573" type="General" weightage="20" keywordseo="air-india" source="Orion">Air India</keyword> is most likely delayed by a month till January as the completion of procedures taking longer than expected, an official said on Monday. In October, the government accepted the highest bid made by a Tata Sons company for 100 per cent equity shares of Air India and Air India Express along with its 50 per cent stake in ground-handling company AISATS — the first privatisation in 20 years. At that time, the government had stated that it wanted to complete the transactions, which included Tatas paying Rs 2,700 crore in cash, by December end. As per the conditions in SPA, all formalities of handover would have to be completed within 8 weeks, but this date can be mutually extended by the buyer and seller and is being done in this case. However, some regulatory approvals are yet to come in for the handover, and certain formalities are yet to be completed, the official, who wished not to be named, told PTI. “The process would be completed by January,” he said without giving a specific date. On October 25, the government had signed the share purchase agreement with Tata Sons for the sale of national carrier Air India for Rs 18,000 crore. Tata’s would pay Rs 2,700 crore cash and takeover Rs 15,300 crore of the airline’s debt. The cash component would come once the handover process is completed, another official explained. Tatas beat the Rs 15,100-crore offer by a consortium led by SpiceJet promoter Ajay Singh and the reserve price of Rs 12,906 crore set by the government for the sale of its 100 per cent stake in the loss-making carrier. As of August 31, Air India had a total debt of Rs 61,562 crore. 75 per cent of this debt or Rs 46,262 crore will be transferred to a special purpose vehicle AIAHL before handing over the loss-making airline to Tata Group. Tatas will not get to retain non-core assets, such as the Vasant Vihar Housing colony of Air India, Air India Building at Nariman Point, Mumbai, and Air India Building in New Delhi. Of the 141 Air India aircraft that Tatas will get, 42 are leased planes, while the remaining 99 are owned. While this will be the first privatisation since 2003-04, Air India will be the third airline brand in the Tatas’ stable – it holds a majority interest in AirAsia India and Vistara, a joint venture with Singapore Airlines Ltd. Tata’s acquisition of Air India will give it access to a fleet of 117 wide-body and narrow-body aircraft, and Air India Express Ltd another 24 narrow-body aircraft besides control of 4,400 domestic and 1,800 international landing, and parking slots at domestic airports. Air India started suffering losses every year since its merger with Indian Airlines in 2007-08. A Turnaround Plan (TAP) and a Financial Restructuring Plan (FRP) were approved for Air India by the previous UPA regime in 2012. However, the TAP did not work out, and Air India continued to reel under losses, with the government giving Rs 20 crore per day to keep the airline afloat. Over the last decade, more than Rs 1.10 lakh crore was infused by way of cash support and loan guarantees in the loss-making airline to keep it afloat. SEE ALSO <a href="https://www.businessinsider.in/finance/banks/news/rbl-bank-depositors-need-not-worry-assures-rbi/articleshow/88520325.cms">RBL Bank depositors need not worry, assures RBI</a> <a href="https://www.businessinsider.in/tech/news/apple-reportedly-hires-metas-communications-lead-for-its-augmented-reality-products/articleshow/88516091.cms">Apple reportedly hires Meta's AR communications lead for marketing of its unannounced AR/VR headset</a> <a href="https://www.businessinsider.in/stock-market/news/rbl-bank-slumps-15-after-ceo-goes-on-leave-big-investors-are-eyeing-a-piece-of-the-pie/articleshow/88515146.cms">RBL Bank slumps 20% after CEO goes on leave</a>

Air India handover to Tata Group delayed further

<ul><li>The sale of the national carrier has always been a politically sensitive issue.</li><li>Reports suggest that the government may sell the airline but transfer just a fourth of the company's debt.</li><li>The proposal may give Narendra Modi's rivals ammunition to attack him for selling a national asset cheap.</li></ul>The sale of Air India has been contemplated for years, unsuccessfully. An attempt made in 2018 failed too. Now, there is a consensus like never before that the ailing national carrier must be disposed off to a willing investor. But, there may be a new twist in the tale that may make the issue political once again. According to an <a href="https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/new-air-india-sale-offer-may-keep-working-capital-debt-out/articleshow/71176962.cms" data-type="tilCustomLink" target="_blank">Economic Times report citing sources</a>, the government is looking to reduce the amount of debt on the books to a fourth of its original amount before selling the airline. When the government invited bids for Air India in 2018, the debt on the books was close to ₹59,000 crore. Of that, ₹29,400 crore was moved to a special purpose vehicle (SPV) that houses debt and assets of the national carrier. This amount is being repaid through government-guaranteed bond issues in three batches. Of the ₹30,000 crore remaining, about ₹15,000 crore is working capital debt, which the government may reportedly bear the burden. So, the potential buyer will only have the remaining ₹15,000 crore to shoulder-- just a fourth of the original amount. Making Air India attractive The idea is to make the debt-laden Air India, with all its operational inefficiencies, an attractive proposition for potential buyers. There was no response to the government's last call for bids. However, some of the factors have changed since last year. On the upside, the disappearance of Jet Airways from the Indian skies has helped airlines charge more for tickets and make some money out of it. So much so that Air India is hoping to turn profitable this year, for the first time in over a decade. On the downside, while India's aviation sector is expected to become the world's third largest aviation market by 2024, according to the International Air Transport Association, the passenger traffic has slowed down in recent months and that has dented performance for all airlines. The government is also hamstrung by its own ideological parent, the Rashtriya Swayamsevak Sangh's insistence that the airline must not be sold to a foreign peer. That leaves very few interested parties who may be interested or can afford to spend on buying an airline. While on the balance, the government will weigh out all its options, Prime Minister Narendra Modi's political rivals are unlikely to miss any opportunity possible to corner the government finding faults in the sale of Air India, a national asset that has evoked strong emotions in the past. SEE ALSO: <a href="https://www.businessinsider.in/emirates-wont-buy-air-india-but-spicejet-flights-under-code-share-likely-by-diwali/articleshow/70970408.cms" data-type="tilCustomLink" target="_blank">Emirates is not interested in Air India but is excited about its code share with SpiceJet</a>

Indian government is looking to sell Air India but may keep its debt

Mumbai, Dec 16 () The government is working on the debt issue of national carrier Air India to make it more attractive to buyers, a top official said on Monday. 
 Civil Aviation secretary Pradeep Singh Kharola indicated that the government's decision to retain partial stake in the national carrier coupled with huge debt prevented potential investors to bid for the debt-ridden airline.
 "We made an attempt last year. We learnt a few lessons and we are trying to work on that and improve at this point in time. The major lesson was that time we said that only 76 per cent of Air India will be disinvested and rest 24 per cent will be retained by the government.
 "However the feedback we got was people were not much interested and they wanted 100 per cent disinvestment so this time its is 100 per cent," Kharola said at the India Economic Conclave 2019 here.
 The second and the most important learning of the bid process was regarding Air India's accumulated huge amount of debt, which was retained by saleable part of the airline and was parked in the special purpose vehicle.
 "However, investors thought that the amount of debt retained by the carrier was not going to sustain so we are working on that also. We will see to it that the debt being parked with Air India is such that any bidder will be able to make it sustainable and if he feels that he can invest and improve profitably," Kharola added.
 He also said the government has been discussing the issue of substantial ownership and effective control, saying each country says that if you want to operate from the same country, then substantial ownership will lie with the national (partner).
 Kharola further said that the 20 per cent decline in capacity due to the grounding of Jet Airways in April this year has been compensated fully after the induction of aircraft by operators and it is now more than that before the airline stopped operations.
 "Because of some problem one of the airlines had to suspend operations and almost 20 per cent of our capacity disappeared. In spite of that if we look back and see the number of aircraft flying before that airline stopped its operations and number of aircraft flying now there is growth of almost 5-6 per cent which means the industry has not only wiped out the gap or the vacuum created but it has also added on to capacity," he said.
 Kharola also said that If the country has to grow in double-digits, some sectors will have to grow in double digits as well. "If we see aviation, it is one sector which has established and proved that it has the potential to grow double digits," he said.
 The domestic aviation market has grown at a cumulative rate of 16 per cent in the last 4-5 years and that's where the answer to growth lies, he said. "This year the aviation sector has proved its resilience." The domestic air traffic returned to double-digit growth in November at 11.6 per cent after clocking single digit till October with April traffic growth in negative territory.
 Stating that the number of operational airports was likely to double in the next five years from 100 now, Kharola said, "That will need a multi-pronged approach the most important being enlightening the private sector to invite in airport projects and the response (so far) has been extremely good."
 Around 600 aircraft flying at present and in the next five years the number is going to be double, therefore the government is trying to make policy interventions to create a congenial atmosphere so that this doubling of airplanes does take place, he said.
 Noting that the viability of airlines is important and he said the government is trying to address the issue which can be done in various ways.
 "One is on the cost side. On that we are working on lease financing. Majority of aircraft operators are lease financed and unfortunately almost all of these are lease financed from overseas. ... we are working on it so it can be done in India. At the same time, we are also working towards making India the MRO hub," Kharola added. PSK AA MR

Govt working on debt issue of Air India to attract buyers: Secy

<ul><li>The <keyword id="6377129" type="UNKNOWN" weightage="20" keywordseo="government-of-india">Government of India</keyword> issued a new expression of interest for 100% sale of <keyword id="2573" type="CITY" weightage="20" keywordseo="Air-India">Air India</keyword>. </li><li>The bidding party will have to bear ₹23,286 crore of the total ₹60,000 crore debt of Air India. </li><li>Recently, the Hinduja Group had expressed interest in bidding for Air India. </li></ul>Air India is straddling a debt of ₹60,000 crore, and that has put a dampener on the government’s plan to disinvest its stake in it. Today, the Government of India issued a new expression of interest for 100% sale of the troubled state-owned airline. As per the revised EoI, the bidding party will have to bear ₹23,286 crore of the total ₹60,000 crore debt of Air India. And the deadline for bidders is set on March 17. According to IANS, the net worth for eligible bidders too has been relaxed to ₹3,500 crore from ₹5,000 crore. The new EOI comes in after multiple attempts at the sale of Air India seem to have failed as few wanted to take on the massive debt. One of the few interested parties include the Hinduja Group. Interestingly, the Hinduja Group was earlier keen on bidding for the now defunct Jet Airways, but now seems to have pivoted to a “better asset”, <a href="https://www.business-standard.com/article/companies/hinduja-and-us-based-interups-join-race-to-acquire-cash-strapped-air-india-120012500027_1.html">as per Business Standard</a>. Earlier, in an <a href="https://timesofindia.indiatimes.com/business/india-business/will-ask-my-team-to-look-at-bidding-for-ai-tata-group-chief/articleshow/71883484.cms">interview with TOI</a>, Tata Group Chairman N Chandrasekaran had said that the Tata Group might consider bidding for Air India and will get his team to look into the matter. In a recent interview with <a href="https://www.ndtv.com/video/shows/executive-decision/have-no-choice-but-disinvestment-air-india-chief-to-ndtv-538592">NDTV,</a> Ashwani Lohani, the Chairman &amp; Managing Director of Air India had said that there was no choice but to go ahead with the <keyword id="44532" type="PERSON" weightage="20" keywordseo="Disinvestment">disinvestment</keyword> of airline. He had expressed optimism that the airline will perform much better once disinvested. Meanwhile, for FY19, Air India had posted a massive <a href="https://m.economictimes.com/industry/transportation/airlines-/-aviation/air-india-posts-rs-4600-cr-operating-loss-in-2018-19-aims-operating-profit-this-fiscal/articleshow/71136113.cms">operating loss</a> of ₹4,600 crore, while its net loss stood at ₹8,400 crore. It has a massive debt of ₹58,351 crore and debtors are knocking down their doors. State-owned oil companies recently <a href="https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/pay-monthly-or-will-cut-fuel-supply-at-6-airports-from-oct-18-oil-companies-to-air-india/articleshow/71525811.cms?from=mdr">sent a letter</a> asking them to pay up dues and threaten to stop supply of aviation turbine fuel (ATF). See Also: <a href="https://www.businessinsider.in/thelife/personalities/news/jet-airways-had-caught-the-attention-of-srichand-and-gopichand-hinduja-who-are-worth-16-billion/articleshow/73068506.cms">The billionaires who want to fly Jet Airways are also the world's largest bus manufacturers</a> <a href="https://www.businessinsider.in/air-india-flights-sale-may-not-include-its-debt/articleshow/71177898.cms">Indian government is looking to sell Air India but may keep its debt</a>

Indian government sweetens Air India sale by slicing its debt burden by more than half

<ul><li><keyword id="2573" type="CITY" weightage="20" keywordseo="Air-India">Air India</keyword>’s total employee strength stands at 17,984, out of which 9617 are permanent employees. Over 36% of the permanent employees will be retiring in the next 5 years.</li><li>The Government of India issued a new expression of interest for 100% sale of the troubled state-owned airline.</li><li>There are reports of interest from HIndujas and Tatas in bidding for the airline.</li></ul>The government wants to ensure that Air India is sold this time around, as it has also cut down the debt that the new owner will take onto the books. But there remains yet another hurdle that has been keeping the state-owned airline from being sold - its employees and their unions. According to a release from the <keyword id="149609" type="ORGANIZATION" weightage="20" keywordseo="Ministry-of-Civil-Aviation">Ministry of Civil Aviation</keyword>, the airline has 17,984 employees, out of which 9,617 are permanent. Over 36% of the permanent employees will be retiring in the next 5 years - that is almost 3,000 of them. “The trade union representatives are said to have discussed with the management all the issues concerning their employment such as service-contracts, job-security, gratuity, pension and voluntary retirement scheme after the company goes into private hands,” a source told PTI after <a href="https://www.businessinsider.in/business/news/air-india-panel-discusses-privatisation-related-issues-of-employees/articleshow/73672621.cms">a panel </a>of Air India management and trade unions met in Delhi recently. These employees could now seek what other troubled state-owned companies like <a href="https://www.businessinsider.in/business/corporates/news/tata-motors-is-the-third-biggie-after-bsnl-and-mtnl-to-dole-out-voluntary-retirement-package/articleshow/72270927.cms">BSNL</a> and MTNL received. Voluntary retirement scheme for Air India - before or after the sale? The Indian government had retired over 92,700 employees via VRS for the employees of the debt-laden <keyword id="30351" type="CITY" weightage="20" keywordseo="BSNL">BSNL</keyword> and MTNL– the telecom giants that it’s trying to merge and revive. However, with Air India’s sale and privatization in mind, VRS could be a risky move as it is uncertain about the liability of the settlements. But it will also offer an opportunity for the government or the bidder to cut down on the number of Air India’s employees. 
 
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 And, there are other issues that have to be cleared by the buyer as well. As per the bid document, 3% of equity shares of Air India are to be offered to the permanent employees of Air India as stock options. However, employees’ dues of about ₹1383.7 crore will be cleared by the government, before the transaction closes. The Government of India’s new expression of interest for 100% sale of the troubled state-owned airline, has already taken a large chunk of the liability onto itself. As per the revised EoI, the bidding party will have to bear ₹23,286 crore of the total ₹60,000 crore debt of Air India. And the deadline for bidders is set on March 17. The net worth for eligible bidders too has been relaxed to ₹3,500 crore from ₹5,000 crore. Tatas and Hindujas show interest in Air India An IANS report quoted a private airline senior executive to say that the deal is sweeter than expected. And it seems to have had its effect. According to recent reports, <a href="https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/vistara-may-explore-opportunities-to-bid-for-air-india/articleshow/73683872.cms">Tata</a>s who run Vistara along with Singapore airlines, might bid for Air india. In an <a href="https://timesofindia.indiatimes.com/business/india-business/will-ask-my-team-to-look-at-bidding-for-ai-tata-group-chief/articleshow/71883484.cms">interview with TOI</a> in November, Tata Group Chairman N Chandrasekaran said that he will get his team to look into the matter. “Ideally it should be a Vistara decision, not a Tata Sons decision. I’m not going to run a third airline (in addition to Vistara and AirAsia) unless we merge. There are issues. I will never say yes or no. I don’t know,” he told TOI. Interestingly, Air India was run by the Tata Group before the Indian government acquired a 49% stake in the airline in 1948. The Hinduja Group has also reportedly expressed its interest in bidding for the airline. See Also <a href="https://www.businessinsider.in/business/news/indian-government-sweetens-air-india-sale-by-slicing-its-debt-burden-by-more-than-half/articleshow/73653131.cms">Indian government sweetens Air India sale by slicing its debt burden by more than half</a> <a href="https://www.businessinsider.in/air-india-flights-sale-may-not-include-its-debt/articleshow/71177898.cms">Indian government is looking to sell Air India but may keep its debt</a>

Air India may opt for a BSNL-like voluntary retirement scheme to shed employee cost along with debt

<keyword id="46894" type="General" weightage="20" keywordseo="Tata-Sons" source="Orion">Tata Sons</keyword> has submitted a financial bid for <keyword id="2573" type="General" weightage="100" keywordseo="air-india" source="Orion">Air India</keyword>, among other bidders. "Tatas have submitted a financial bid for Air India," a Tata Sons spokesperson said. Taking to Twitter, DIPAM Secretary, Tuhin Kanta Pandey said that the disinvestment process now moves to the concluding stage. "Financial bids for Air India disinvestment received by Transaction Adviser. Process now moves to concluding stage," he posted. Though Tatas have confirmed their particiupation in the financial bid, sources said that the promoter of domestic carrier SpiceJet, <keyword id="6357826" type="General" weightage="20" keywordseo="Ajay-Singh" source="Orion">Ajay Singh</keyword> may also have placed the bids for the debt-ridden carrier. The Tatas bid was much-anticipated as its name of had been doing the rounds for some time now. The government has off late taken several steps to fast-track the much-delayed privatisation of the national carrier. Recently, the government decided to waive taxes on the transfer of assets from the national carrier to Air India Assets Holding Ltd, a special purpose vehicle (SPV). "The <keyword id="6357307" type="General" weightage="20" keywordseo="central-government" source="Orion">Central Government</keyword> hereby specifies that no deduction of tax shall be made under section 194-IA of the said Act on any payment made to the <keyword id="334559" type="General" weightage="20" keywordseo="air-india-ltd" source="Orion">Air India Ltd</keyword> for transfer of immovable property to Air India Assets Holding Ltd under a plan approved by the Central Government," said a notification. Further, the CBDT also allowed new owners of erstwhile public sector companies to carry forward losses and set these off against future profits, in a bid to raise more interest for the proposed privatisation processes. During the Budget speech for FY22, Finance Minister Nirmala Sitharaman had said that all the proposed privatisation process would be completed by the end of the fiscal, including the much-delayed strategic disinvestment of Air India. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/cryptocurrency/news/bitcoin-mining-isnt-just-consuming-energy-its-also-generating-272-grams-of-e-waste-with-every-transaction/articleshow/86228818.cms">Bitcoin mining isn't just consuming energy, it's also generating 272 grams of e-waste with every transaction</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/ami-organics-ipo-rewarded-investors-with-12288-profit-on-the-second-day-of-listing/articleshow/86228819.cms">Investors who had put money in this IPO made over ₹12,000 profit in 2 days</a>

You Searched For "Air India debt" and got 10 results

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