New Delhi (IANS) - A day after the Union cabinet gave its in-principle approval for Air India's divestment, Civil Aviation Minister Ashok Gajapathi Raju said that the budget passenger airline IndiGo has expressed interest in participating in the stake sale of the flag-carrier.
"There has been interest shown for Air India. IndiGo has approached the ministry with a formal expression of interest proposal," Raju said. "Other airlines have also shown interest in Air India, but they have not submitted any formal proposals as yet," he added.
According to Civil Aviation Ministry Secretary R.N.Choubey, a formal proposal from IndiGo was received after June 28's cabinet decision on Air India's divestment. When contacted, an official from IndiGo said that the airline was "observing a silent period".
However, the airline informed the BSE that it has evinced interest in Air India's stake sale through a letter. "As the government embarks on the journey of privatising Air India and given IndiGo's track record of having created a consistently profitable airline with a strong balance sheet, kindly treat this latter as our expression of interest in acquiring the international airline operations of Air India and Air India Express," Aditya Ghosh, President and Whole Time Director, IndiGo said in a letter sent to the Civil Aviation Minister.
"Alternatively, we are equally interested in acquiring all of the airline operations of Air India and Air India Express," the letter dated June 28 and addressed to Minister Raju read. At present, the national passenger carrier has a debt burden of more than Rs 50,000 crore. The airline in 2015-16 had posted an operating profit of Rs 105 crore. For the last fiscal 2016-17, the company is expected to report an improved operating profit margin.
Air India's former Executive Director Jitender Bhargava told BTVi in a interview that he was "glad to see a change in narrative" in which AI's assets base is now being considered. "There has been a major change in government thinking... now AI assets are also given equal emphasis," Bhargava said.