Air India raises Rs162 cr through sale of 26 properties
07 December 2018
Debt-laden national carrier Air India has raised around Rs162 crore through sale of 26 properties so far in the latest asset monetisation drive, reports quoting sources familiar with the matter said.
The airline had invited bids for over 85 real estate items, including residential, commercial properties and flats across 16 cities such as Mumbai, Pune, Lonavala and Chennai among others.
Air India management, which has been trying to pare its debt by monetising non-core assets, mainly real estate properties, floted an advertisement on 13 November for sale of properties and the due date for bids ended on 4 December.
A CNBC-TYV 18 report said the state-run airline is also likely to invite bids for the iconic Air India building at Nariman Point in Mumbai this month.
An earlier move to sell the property, which currently fetches an annual rental income of around Rs110 crore for Air India, did not materialise as talks with state-run Jawaharlal Nehru Port Trust failed.
Reports also said that Air India may delay the sale plan as discussions on renting out some more floors of the building are under consideration.
Air India has roped in Cushman and Wakefield as its realty consultant and bids are expected to be invited this month.
A ministerial panel set up for Air India disinvestment had last month cleared strategic sale of the airline’s ground handling subsidiary Air India Air Transport Services Limited (AIATSL).
Under a financial restructuring and turnaround plan for Air India, approved by the Cabinet Committee on Economic Affairs in 2012, Air India had planned to monetise real estate assets to the tune of Rs5,000 crore over a period of 10 years with an annual target of Rs500 crore from 2012-13 (April-March) onwards.
However, till March, the airline could only sell properties worth over Rs500 crore as against expectation of Rs3,000 crore.
Further, till July, the sale of 30 properties have been taken up by auction through MSTC, a public sector undertaking, and revenue of Rs 724 crore was realised by the airline, as per the government data.
Air India, which is sitting on a debt pile of Rs55,000 crore, is on borrowed time after the government deciding against the transfer of nearly Rs29,464 crore of its debt into a special purpose vehicle in a clean-up act.