Wednesday, December 18, 2019

Centre may shift more debt out of AI balance sheet before sale


              According to the senior airline official of Air India it is said that the government is looking to shift out more debt from the balance sheet of disinvestment bound Air India to asset holding firm Air India Assets Holding Ltd (AIAHLfor making further accepatable by the prospective buyers. The government is palnning to sell their full stake (100%) in the loss making carrier. Air India is now facing a shortage of money due to lack of fund infusion,they are also facing monthly shortfall of Rs.220 crore in there operations. Inorder to make the disinvestment more attractive the carrier(a special purpose vehicle SPV) has already transferred Rs29,474 crore of debt to Air India Asset Holding.
              
             On Monday conference ,Civil Aviation Secretary pradeep Singh Kharoola said that Earlier , their plan was to sell debts in proportion to assets, as part of it they have transferred about half of the total debt to AIAHL.Now they are evaluating if they can take more debt from balance sheet by selling the SPV(special purpose vehicle). They also added that the government is now looking to make the deal more attractive or acceptable by the buyers. Air India is now seeking Govt. approval to raise a Rs.2000 crore loan and refinance $819 million aircraft debt , which is an relaxation for the financial crisis. The officials said that Air India is such that any person or organisation will be able to make it sustainable and if he feels that he can invest and improve profitability.
              
             Air India received an offer from a consortium of four banks to refinance the $819 million bridge loan taken for acquiring six Boeing 787 and one Boeing 777 aircraft. Presently Air India has a debt for about more than Rs58000 crore. The airlines net loss in the year 2018-19 is estimated of about Rs.8556.35 crore. An industry expert told that the airline cannot be given for free and that any prospective buyer will have take the burden of some part of the total debt. At present Air India owns over 60 planes out of thet total of 127 in the fleet , which are treated as good assets. On December 12 , Minister of state for Civil Aviation Hardeep Singh Puri said that after formation of new government , Air India Specific Alternative Mechanisim (AISAM)has been rconstituted,the reinititation of disinvestment of Air India has been approved.AISAM has approved 100% sale of govt. of India stake in Air India for the reinititated strategic disinvestment of Air India, he said on Lok Sabha.


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