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- Tata Son’s Bid For Air India Is More Than SpiceJet Promoter, Company Strong In The Initial Phase
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9 hours ago
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Early in the ongoing bid for Air India, Tata Sons, the holding company of the Tata group, has offered more than Ajay Singh, the promoter of SpiceJet. The government wants to sell its airline company in the current financial year ending next March. However, due to the Kovid postponement of several works such as due diligence, it may be a few months late to complete the sales process.
Decreasing cash flow and valuation of the company
According to experts, Tata Sons is in a very strong position in the current round of bidding for the state-run airline company. Air India flights are being canceled amidst the second wave of Kovid and its load factor has also decreased. Due to this, the cash flow and valuation of the company is decreasing.
Experience of running airline business will be seen
According to experts, many things will be seen in the company joining the bid. Like how many years of experience he has in running an airline business. Has handled a fleet of planes and has served flights to many countries. How is the leadership structure, brand and Goodwill of the company. How much expertise is there in the management of non-core assets. How much experience in managing retirement and pension benefits. How much capacity do staff have to handle.
Bidder can postpone inspection of real estate property
There may be a delay in completion of the sale process of the company. Buyers would like to visit the company’s real estate property. But this will not be possible for some time due to Kovid. This was said on Wednesday by Tuheen Kant Pandey, Secretary, Deepam (Department of Investment and Public Asset Management). Deepam is the nodal agency to oversee the company’s disinvestment program.
Disinvestment target to be completed in the first half of the financial year
Pandey had said that the government has set a target to complete the disinvestment of Air India in the first half of this financial year, but there may be a slight delay. According to some media reports, Ajay Singh, the Tata Group and SpiceJet CMD for Air India, has been shortlisted for bidding in a private capacity.
Tata Sons is thinking about reducing the valuation of the company
One of the industries that has been the most affected by Kovid is the airline industry. People have reduced flight taking due to the increased infection of Kovid. In such a situation, Tata Sons is thinking about reducing the valuation of the company. It can also ask the government to raise a major portion of the debt lying on the company’s balance sheet.
