Air India's successful bidder is M/s Talace Pvt Ltd. - GOI

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"VAN" (Delhi Bureau - 08.10.2021) :: Tata Sons won the bid to bag debt-laden Air India, the government said on October 8, a homecoming moment for an airline it founded but gave control to the state.

The Union Cabinet permitted a proposal by a panel of ministers led by home minister Amit Shah to accept the salt-to-software conglomerate’s offer over that of SpiceJet chairman Ajay Singh, the only other bidder in the fray. Singh bid in his personal capacity.

Tata Group quoted an "enterprise value of Rs 18,000 crore", DIPAM Secretary Tuhin Kanta Pandey said, adding that the panel of ministers approved the price in its meeting held on October 4.

Both the qualified bidders had quoted well over the reserve price, the official added.

"A competitive process has been carried out in a transparent manner," Pandey said, noting that the bidders had to quote a "minimum 15 percent of enterprise value for cash consideration".

The official added that bidders were to quote a "maximum 85 percent of quoted enterprise value for retained debt".

The reserve price was set "before opening the sealed financial bids", the DIPAM Secretary clarified, adding that the terms and conditions were not negotiated after receiving the financial bid.

Selling Air India, which has not made profits in 15 years, was a vital piece in the government’s ambition to privatise assets. Finding a buyer was tough because the airline— nicknamed Maharaja—has long struggled to stay aloft, was steeped in losses and bruised by competition.

Friday’s announcement actually marks the culmination of several attempts to find a buyer for the airline founded in 1932. It is good riddance for the government because it no longer has to throw good money at a bad asset it took over from the Tatas 68 years ago.


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