The government has kept a timeline of three weeks to complete the process of opening the financial bids for Air India, sources told CNBC-TV18 on Thursday. However, it expects to complete the process within two weeks.
As a first, the government will on September 16 or September 17 open the non-financial bids or the technical bids and if it is satisfied that none of the bidders have put a conditional bid, it will take the process a step ahead, sources said.
Thereafter, the security clearance of the bidders is to be obtained, which is still awaited.
The development comes a day after the government received the "financial bids" for Air India. "Financial bids for Air India disinvestment received by Transaction Adviser. Process now moves to concluding stage," the department of investment and public asset management (DIPAM) said secretary said in a tweet.
Once the security clearance is obtained, the reserve price will be decided based on the business valuation report of the Transaction Adviser and the asset valuers report on the valuation of the airline, they added. Following this, the financial bids would be opened.
This is the third attempt of the government to divest its stake in Air India after 2001 and 2017. This time, the government invited bids for strategic disinvestment of 100 percent stake of the government of India in the airline. It also includes a 100 percent stake in Air India Express Ltd and a 50 percent stake in Air India SATS. Due to the COVID-19 pandemic, the last date for submission of preliminary bids was extended from time to time. The process was initiated in January 2020.
Air India posted a net loss of Rs 3,836.78 crore in FY16, Rs 6,452.89 crore in FY17, Rs 5,348.18 crore in FY18, Rs 8,556.35 crore in FY19 and Rs 7,982.83 crore in FY20 as per provisional figures. The total debt of the national carrier has risen to around Rs 43,000 crore, officials aware of the matter told CNBC-TV18.
(Edited by : Kanishka Sarkar)