Tatas seek details of Air India divestment

NEW DELHI: The Tata group has informally sought details on the planned sale of Air India, a government official said, reflecting the group’s interest in the airline it founded in 1932.

“They have asked us how do you want to do it, what will you do with debt, and what will happen to the subsidiaries,” the official said, asking not to be identified.

Senior Tata group executives posed the questions in informal discussions “at different levels” of the government after the cabinet approved the disinvestment on 28 June, the official said.

In di Go has already gone public with its interest in Air India.

The Tata executives were told that their questions were in the realm of the group of ministers including Arun Jaitley, Nitin Gadkari, Suresh Prabhu, Piyush Goya land Ashok Gajapathi Raju, which is studying the sale of Air India, said the official mentioned earlier.

The ministers have been asked to look at hiving off certain Air India assets, a possible de merger, strategic disinvestment of three profit-making subsidiaries, quantum of disinvestment, and eligible bidders.

“The meeting is scheduled to be held soon,” the official said.

The Tatas declined to comment. “We do not comment on such matters,” a Tata Sons spokesperson said.

Founded by JRD Tata, Air India was born as Tata Airlines. Its name was changed to the current one in 1946. It was nationalised in 1953. In 2000, the Tata group and Singapore Airlines expressed their interest to buy up to 40% in Air India.

In 2015, The Tata group and Singapore Airlines launched Vistara, which will start international flights next year.

An airline industry executive said Air India will provide a ready network for the group if this process goes through soon, which is also why the group is going easy on placing wide body aircraft orders for Vistara. “I don’t think the government will break Air India into two because then the domestic arm will not have any value left. The international business is the prized catch .”