Centre ready to sell 100 per cent shares of Air India after flop attempt

New Delhi, Jun 13 (DC): The government is understood to be examining the option of offering the entire 100 percent stake in national carrier Air India to a private bidder instead of the earlier 76 per cent.

This follows the shock to the government and the huge setback to the privatisation process for national carrier wherein no initial bids (expressions of interest) were received for acquisition of stake in Air India on May 31.

Following the failure on May 31 when the deadline expired for submission of EoIs, sources had said the government was now likely to re-work terms of proposed sale of stake in the “Preliminary Information Memorandum (PIM)” issued in March this year to make the national carrier more attractive to potential buyers. A new PIM could now be floated following.

The reasons for the debacle were to be examined by an evaluation committee headed by a senior official of the department of investment and public assets management (DIPAM) — which is to submit its recommendations.

These will then be placed before the core group on disinvestment headed by the cabinet secretary. The group’s recommendations in turn will be placed before the “Alternative Mechanism” (group of ministers).

Private firm Ernst and Young was appointed the Transaction Adviser (TA) for the process. The feedback from the TA on what discouraged potential bidders is also likely to be placed before the government.

The Centre is examining why the EoI process was not found attractive by bidders despite the government offering 76 percent stake in Air India and complete management control.