GOVT MAY EXCLUDE $7 BN OF AIR INDIA DEBT
MOVE LATEST BID TO LURE INVESTORS TO THE STRUGGLING CARRIER
NEWDELHI: Air India Ltd’s plan to sell an iconic building in Mumbai has come under a cloud due to the changed political scenario in Maharashtra, potentially affecting plans of the cash-strapped carrier to raise funds.
Bharatiya Janata Party’s (BJP) exit from the helm in Maharashtra would probably junk a plan by the state government to buy the 23-storey tower at Nariman Point for as much as ₹1,400 crore, which former chief minister Devendra Fadnavis was keen upon, said two people familiar with the matter. The building was the carrier’s headquarter till 2013 when it vacated the property as part of asset-monetization plans.
Air India had initially set about ₹1,500 crore as the reserve price for the 220,000 sq. ft building, designed by American architect John Burgee.
“The Fadnavis-led BJP government had plans to convert the building into the chief minister’s secretariat and also connect it through an underground tunnel with the Mantralaya nearby,” said the second person, who too requested anonymity.
Fadnavis had also formed a committee headed by the state’s chief secretary to negotiate the sale of the building. “However, the forthcoming government (Shiv Sena-NCP-Congress combine) may not go ahead with the plan,” the person added.
The Air India building, which overlooks the Arabian Sea, has currently been rented out to the Directorate General of Shipping, State Bank of India, and Tata Consultancy Services. Several floors still lie vacant.
Meanwhile, Jawaharlal Nehru Port Trust, which too had shown interest in the building, no longer wants to acquire it, said a senior company official.
A spokesperson of the Congress party in Maharashtra, which will be part of the new state government along with Shiv Sena and NCP, said it will review major decisions of the previous BJP-led government, which includes the purchase of the Air India building.
“We will review the decision after officially forming the government,” said Congress spokesperson (Maharashtra) Sachin Sawant. Spokespersons of Maharashtra units of Shiv Sena and NCP were not immediately available for comment.