Financial bids for Air India have been expected by September 15. However, there might be no likely impact of Cairn & Devas suits on AI divestment’.
Financial bids for Air India are expected by mid-September. And, the government does not foresee some foreign mega corporations suing AI to recover arbitration awards they have won against India to hamper the divestment of the airline.
With the protest by their employees and workers, the airlines is already in the hot list.
Financial bids for the debt-laden airline
Union minister for state for aviation General (retired) V K Singh said in a Lok Sabha reply Thursday that:
- “Multiple expressions of interest (EoI) were received by transaction adviser (TA, for divesting 100% stake in AI).
- Request for proposal along with draft share purchase agreement have been shared with qualified bidders by the TA on March 30, 2021, for submission of financial bids.
- The financial bids are likely to be received by September 15, 2021.
Proposal by the Union Government
The government is proposing to sell its 100% stake in AI and AI Express and its entire (50%) stake in AI SATS.
- The government hopes to complete AI divestment process within this fiscal.
- Tata Group is among the front-runners to get the airline it had once founded.
- It followed with a consortia led by SpiceJet promoter Ajay Singh being among the other contenders for AI.
Air India Sued
Recently, British oil firm Cairn Energy and Devas Multimedia sued the national carrier. This was in order to recover arbitration awards they had won against the government of India.
Devas petition filed in a New York court says AI is the “alter ego of the Republic of India” and “therefore jointly and severally liable for the debts and obligations of India itself.”
V K Singh on the matter
In a reply to a Parliamentary question if these suits could affect AI’s divestment, General (retd) V K Singh said on Thursday:
- Cairn Energy and Devas Multimedia have filed lawsuits in the US.
- It was in order to seek declaratory and money judgment against AI as an alter ego of the Republic of India.
“There is no likely impact of the lawsuits on the ongoing divestment process of AI as AI is a separate corporate entity with its own management and board. The case is being defended by AI. The company has pointed lawyers to defend its interests.”
Information Source: The Times of India
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