PM Modi's cabinet gave the go-ahead to sell Air India last year
Highlights
- The government wants to sell 76 per cent stake in Air India
- IndiGo said the terms set by the government would not suit it
- The government gave the go-ahead to sell Air India last year
IndiGo says it is opting out of a race to acquire Air India as the terms set by the government would not suit it.
The government had last week released bid documents seeking to sell a 76 per cent stake in the state-run national carrier that operates both domestic and international routes.
The proposed sale will also include a 100 per cent stake in Air India's low-cost arm - Air India Express, and a 50 per cent stake in its ground-handling arm - SATS Airport Services.
"From day one, IndiGo has expressed its interest primarily in the acquisition of Air India's international operations and Air India Express. However, that option is not available under the Government's current divestiture plans for Air India," IndiGo said in a statement.
"We do not believe that we have the capability to take on the task of acquiring and successfully turning around all of Air India's airline operations," said Aditya Ghosh, the airline's president, in the statement.
IndiGo, Tata Group, and Turkey's Celebi Aviation Holdings, have expressed an interest in buying some of Air India's operations. Singapore Airlines has also said the company has an open mind about making an initial bid.
Prime Minister Narendra Modi's cabinet gave the go-ahead last year to sell Air India after successive governments spent billions of dollars to keep it solvent.
But its debt burden of about $8 billion and a bloated cost structure have been a concern. Previous attempts to offload the airline have been unsuccessful.
© Thomson Reuters 2018