Centre says Air India stake sale could be cancelled if bids are too low

The government stated that it is open to pulling the plug on the disinvestment of Air India if it finds that the bids are not up to the mark.

According to a Mint report, Civil Aviaiton Secretary R.N. Choubey told reporters that although the transaction adviser (EY) would give the enterprise value, the final price for the airline will be decided by the government.

The government expects the disinvestment process to be successful, given that it has fielded close to 160 investor queries on the stake sale so far.

The deadline for the submission of Expression of Interest (EoI) is May 31 while the Request for Proposal might be issued after June 15 and the largest bidder to be known by August end. Choubey stated that the government looks to complete the entire process by the year end.

Choubey also assured that that service terms of Air India employees will be protected.

IndiGo, which is India’s largest airline by market share, has said that it is no longer keen on acquiring Air India. The low-cost carrier was the only airline to have shown interest in the divestment process since it was announced.

Ajay Singh, Chairman of low-cost carrier Spicejet, had in January ruled his airline out of the race for the privatisation-bound Air India saying, "we are too small to bid for a large airline like the national carrier."