BIRD GROUP SHOWS INTEREST IN AIR INDIA’S GROUND HANDLING ARM

Aviation service provider Bird Group has shown interest to bid for Air India’s ground handling unit Air India Air Transport Services (AIATSL). A Bird Group spokesperson confirmed the development and said it had written to the Ministry of Civil Aviation expressing interest to buy AIATSL. “We have told the government that if it decides to sell the subsidiary separately to unlock maximum value, we will bid for the ground handling unit,” said a company official. ARINDAM MAJUMDER reports

Aviation service provider Bird Group has shown interest to bid for Air India’s ground handling unit Air India Air Transport Services Limited (AIATSL).

A Bird Group spokesperson confirmed the development and said it has written to the ministry of civil aviation expressing interest to buy AIATSL. "We have told the government that if it decides to sell the subsidiary separately to unlock maximum value, we will bid for the ground handling unit," said a company official.

Earlier, Civil Aviation Secretary Rajiv Nayan Choubey told reporters that the group has sent an expression of interest (EoI) for the same.

Bird Group provides services such as business jet, aircraft navigation, ground handling, customer management and logistics.

Sources said that Air Works, a private maintenance repair and overhaul (MRO) company, has also shown interest to take over the ground handling business of the state-owned carrier.

India's largest airline, IndiGo, also went public about their interest to buy the airline's international business.

A senior Air India official said that it makes sense to sell the subsidiary separately as they themselves will command good value, which can be used to reduce the debt.

Air India’s debt at the end of 2016-17 stood at ~48,876 crore, of which ~31,517 crore (65 per cent) was related to working capital.

The official said that AIATSL would command a value of around ~2,000 crore. “AIATSL is entitled to carry out ground handling services at all airports across India, and any airline will be ready to pay a premium for this,” the official said.

In the case of Air India Engineering Service Limited (AIESL), it has 31 hangars throughout the country. The company pegs its value at ~3,000 crore. Significant among them is the Nagpur facility, which has an engine workshop valued at around ~1,330 crore, and Shamshabad facility at ~200 crore. Besides, it also has workshop equipment valued at around ~200 crore and a large base of skilled engineers.

A group of ministers led by Finance Minister Arun Jaitley will decide on the modalities of Air India's disinvestment process.