The Adani group is likely to join the race to bid for national carrier Air India. Billionaire industrialist Gautam Adani-backed Adani group is all set to submit an Expression of Interest (EoI) by next month, media reports said quoting sources close to the conglemerate.
Reportedly, the final decision of Adani will, however, depend on the outcome of the due diligence after submission of the EoI. After the EoI process, prospective bidders will get access to data of the airline. The last date to submit EoI is March 17.
If Adani enters the race, Air India sale will see an interesting fight among the likes of the Tatas, the Hindujas, IndiGo and New York-based fund Interups competing for the bleeding national airlines. If Adani wins the race, it will make way for its big bang entry into India's domestic airlines sector.
However, as the Business Standard reports, Adani's bid might face legal challenges due to its ownership of airports. The Adani group currently operates three airports—Lucknow, Ahmedabad and Mangalore—and is awaiting government clearance for another three—Thiruvananthapuram, Jaipur and Guwahati.
While there are no restrictions on an airport developer to bid for Air India, bid conditions for six Airport Authority of India (AAI) airports won by the Adani group place ownership caps. According to the bid criteria, an airline or a group owning an airline cannot own more than 27 per cent in these six airports. This might complicate matters for the Adani group.
This is the second time in less than two years that the government has come out with proposal for selling stake in Air India, which has been in the red for long. The beleagured Maharaja is up for grabs as the Centre looks to raise around Rs 60,000 crore through its sale.
The national carrier, which has a debt burden of more than Rs 50,000 crore, has been making loss for long and as part of revival efforts. Air India's net loss in 2018-19 is provisionally estimated to be Rs 8,556.35 crore.
