Air India finally has a chance to lose the baggage

Phillip Cunningham
March 30, 2018

After all, in the Preliminary Information Memorandum, Air India and its subsidiaries have committed to pay these arrears "before consummation of the Proposed Transaction".

IndiGo, India's biggest airline, is the only company to publicly disclose a desire to buy Air India's airline operations - the most lucrative business that includes prime time slots at airports from NY to Heathrow, as well as bilateral rights to start flights to most countries.

One of the crucial assets that Air India offers its new owners in this era of constrained airport infrastructure is 3,739 domestic slots for arrival and departures at local airports and 2,543 global slots for arrivals and departures at both Indian and worldwide airports. Bidding closes on May 14.

"However, we will keep our options open with respect to the proposed divestment of Air India, " The Singaporean carrier said in a statement.

On March 22, Air India's maiden flight to Israel landed in Tel Aviv, reducing the travel time substantially after Saudi Arabia for the first time allowed a commercial flight to use its airspace, indicating a thaw in relations between the Arab kingdom and the Jewish state.

From the mid-'80s right up to the dawn of the new millennia, governments across most of the developed world exited the airline business. "Later, the security agencies also asked AI to make passengers deboard as the plane needed to be taken to a remote bay for more checks", said an AI official.

Accordingly, it has been planned that the government will divest 76 percent of its stake in AI, 100 percent in AIXL and 50 percent in AISATS. As per the memorandum, the selected bidder should abide by conditions set out in the Request for Proposal (RFP) or the definitive documents to safeguard employees' interests.

According to the memorandum, the employees' dues to the tune of Rs 1,298.2 crore on account of Justice Dharamadhikari Commission Report is in the nature of past arrears.

The Narendra Modi government has appointed London based multinational professional service provider Ernst & Young as the only transaction advisor.

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