The Indian government is considering all potential options as it edges closer to putting its troubled national carrier up for sale. Bloomberg reports that the government could take on part of the USD8 billion debt of Air India (AI, Delhi International) to attract investors, or sell off parts of the business in separate deals.
"Suppose a portion of its debt is removed, non-aviation-related assets are removed and put into a shell company owned by the government, I think things will work," said Aviation Minister Ashok Gajapathi Raju.
The non-aviation assets include international real estate and two hotels. Air India also has separate units that deal with charters, ground handling services, transport, and engineering.
At least two companies have expressed interest in the ground handling unit, Air India Air Transport Services Limited (AIATSL). Aviation services provider Bird Group has registered its formal interest, and Turkish ground handling provider Celebi is also keen.
If the government decides to break up Air India into its constituent parts, then IndiGo Airlines (6E, Delhi International) is interested in taking on its international operations.
However, with its staggering debt, it may be hard to convince investors to go near Air India.
"If debt has to go with it, no one will be interested," Raju said, seemingly paving the way for further government intervention. "Its books are bad, you can’t leave it like that."
