File photo of the inaugural Air India flight as it arrives at San Francisco International Airport. (Amar D. Gupta/Siliconeer)
Tata group is believed to be discussing buying a stake in debt-laden Air India amid the government looking at various options, including full or partial privatization, to revive the national carrier, sources said.
When contacted, a Tata group spokesperson said, “We don’t comment on speculations.”
Staying afloat on taxpayers’ money, Air India has been in the red for long and various proposals, including government think-tank Niti Aayog’s suggestion for complete privatization, have been made.
Sources said Tata group is evaluating options on buying stake in Air India.
In this regard, there have been internal meetings as well as meetings with government representatives, sources added.
There was no official word from the government but sources said the Civil Aviation Ministry is keen on retaining the national carrier status of Air India.
One scenario being discussed is that the government would retain 51 percent stake and the rest 49 percent could be sold to private players, which could include foreign players.
Sources said in such a situation, the government would have majority stake but operational control would be with the minority stakeholder.
The government is also looking at various options such as selling off non-core assets to reduce the airline’s debt burden.
For the Tatas, it would be more of a home coming.
Air India traces its roots to Tata Airlines, which was formed back in 1932. Set up by Tatas, the carrier was made a public company and was rechristened as Air India. Later, it was nationalized.
Earlier also, Tatas had tried to acquire stake in Air India.
Currently, Air India has a debt of more than Rs. 52,000 crore.
Minister of State for Civil Aviation Jayant Sinha said, June 20, inter-ministerial consultations on the future course of action for Air India have been completed and the Cabinet would decide on how best to move forward.
Recently, Finance Minister Arun Jaitley had said the aviation ministry has to explore all possibilities “as to how the privatization of Air India can be done.”
Tata already has two airline joint ventures—Vistara and AirAsia India.