Govt to sell Air India’s realty assets in Delhi

Govt to sell Air India’s realty assets in Delhi
29/11/2018 , by , in News/Views

The government has decided to sell Air India’s prime real estate in Capital’s Vasant Vihar and central Delhi, along with a strategic sale of its subsidiary Air India Air Transport Services (AIATSL) as it seeks to get the national carrier back in shape.

A ministerial panel headed by finance minister Arun Jaitley on Tuesday gave a green light to sell Air India’s 27 acres to public sector company NBCC in upmarket Vasant Vihar, which will be used to build high-end luxury apartments, sources told media.

A decision has also been taken in-principle to take up the sale of a large plot on Baba Kharak Singh Marg, next to Connaught Place, which can be taken up for commercial use.

In the next phase, the government wants to decide on several buildings owned by Air India as the loss-making carrier does not need the large amount of real estate that it possesses.

The sale of AIATSL and some of the other subsidiaries, along with monetisation of the public sector player’s real asset assets, are expected to help Air India raise over Rs 10,000 crore by government’s estimates.

This amount is proposed to be used to repay bank loans, which add up to around Rs 50,000 crore and are weighing down on the state-run airline’s finances.

Cleaner books and lower oil prices are expected to pave the way for Air India disinvestment in the future, after the government failed to find a buyer earlier this year, prompting it to shelve the plan for the time being.

AIATSL had reported a profit of over Rs 61 crore in 2016-17. On Tuesday, the Alternate Mechanism, or the ministerial panel, has approved EoI (Expression of Interest), along with the Preliminary Information Memorandum, for strategic sale of AIATSL, an official said.

The sale would happen after transferring AIATSL to a Special Purpose Vehicle (SPV), which has already been incorporated, the official said.

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