Watch­ing AI stake sale process closely: IFC

Financial Chronicle - - FRONT PAGE - PRESS TRUST OF IN­DIA

AS the gov­ern­ment awaits ex­pres­sion of in­ter­est for Air In­dia stake sale, In­ter­na­tional Fi­nance Corp (IFC) has said it is “watch­ing the process closely and may get in­volved at a later stage.” IFC, part of the World Bank Group, made it clear that it is cur­rently not in­volved in the Air In­dia dis­in­vest­ment process.

The gov­ern­ment has came out with a de­tailed pre­lim­i­nary in­for­ma­tion mem­o­ran­dum, de­tail­ing plans to off­load up to 76 per cent stake in debt­laden Air In­dia and trans­fer the man­age­ment con­trol to pri­vate play­ers. How­ever, the am­bi­tious stake sale of Air In­dia as well as its two sub­sidiaries seem to be hit­ting air pock­ets with two po­ten­tial bid­ders — IndiGo and Jet Air­ways — de­cid­ing to keep away cit­ing the con­tours of the process. a

While re­ports have men­tioned that var­i­ous en­ti­ties, in­clud­ing quite a few global air­lines, are in­ter­ested in Air In­dia dis­in­vest­ment, there has been no of­fi­cial word about any par­tic­u­lar en­tity. At present, IFC is not in­volved in the Air In­dia dis­in­vest­ment process, a spokesper­son said, adding that nor­mally it does not join the fray dur­ing the bid­ding phase.

“How­ever, we are com­mit­ted to bridg­ing de­vel­op­ment gaps in In­dia and fi­nanc­ing trans­port and lo­gis­tics is one of our top strate­gic pri­or­i­ties, as it is for the coun­try. There­fore, we are watch­ing the Air In­dia process closely and may get in­volved at a later stage. Once the win­ning bid­der is cho­sen, we will eval­u­ate the sit­u­a­tion to see if we have a role to play,” the IFC spokesper­son told PTI in an emailed state­ment.

The re­sponse came to a query on whether IFC would be in­ter­ested in the dis­in­vest­ment process. A global de­vel­op­ment in­sti­tu­tion, IFC is fo­cused on the pri­vate sec­tor in emerg­ing mar­kets. When asked whether Lufthansa would be in­ter­ested in par­tic­i­pat­ing in the dis­in­vest­ment process, the Ger­man air­line said, “your as­sump­tion is based on mar­ket spec­u­la­tion” and that it does not com­ment on spec­u­la­tion.

“With a pres­ence of over half a cen­tury, In­dia is a strate­gic mar­ket for Lufthansa Group and we are com­mit­ted to in­crease our of­fer­ings by in­tro­duc­ing our lat­est and most in­no­va­tive prod­ucts and ser­vices and by pro­vid­ing un­ri­valled con­nec­tiv­ity,” it said.

Queries sent to Bri­tish Air­ways, Malaysian Air­lines, Eti­had Air­ways and Qatar Air­ways on whether they are in­ter­ested in Air In­dia stake sale did not elicit any im­me­di­ate re­sponse. Ques­tions mailed to Air Ara­bia on whether it would be look­ing at Air In­dia Ex­press re­mained unan­swered.

Ac­cord­ing to the pre­lim­i­nary in­for­ma­tion mem­o­ran­dum, is­sued on March 28, the gov­ern­ment will re­tain 24 per cent stake in Air In­dia, while the win­ning bid­der will be re­quired to stay in­vested in the air­line for at least three years.

The pro­posed dis­in­vest­ment will in­clude prof­it­mak­ing Air In­dia Ex­press and joint ven­ture AISATS. The lat­ter is an equal joint ven­ture be­tween the na­tional car­rier and Sin­ga­pore-based SATS Ltd.

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