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Who will take away Air India?   

Who will take away Air India?   

While the EoI (expression of interest) clearly states that the national carrier will go to the highest bidder, the government will also consider the financial condition of the prospective buyer before finalising the winner

Tata Group and SpiceJet’s Ajay Singh are reportedly the likely suitors for Air India Tata Group and SpiceJet’s Ajay Singh are reportedly the likely suitors for Air India

The bidding process for Air India has entered the final phase. After receiving multiple bids for the national carrier, the government will likely announce the winning bid over the next few weeks. Minister of Civil Aviation Jyotiraditya Scindia recently said that the ministry has received financial and technical bids, and currently the technical bids are being scrutinised. As per news reports, the government will shortly open the financial bids.
 
Tata Group and SpiceJet’s Ajay Singh are reportedly the likely suitors for Air India. While the EoI (expression of interest) clearly states that the national carrier will go to the highest bidder, the government will also consider the financial condition of the prospective buyer before finalising the winner.
 
Experts say that Tata Group has an edge over Singh in bagging Air India. How? Take a look at the financial situation.
 
Even though the two airline ventures of the Tata Group – Vistara, AirAsia India – are in deep losses, the parent company seems to have an unmatchable financial competence. As per Tata Group, the consolidated revenues of Tata companies stood at Rs 7.5 lakh crore in FY20. In comparison, the biggest venture of Singh, that is SpiceJet, had a negative net worth of Rs 3,298.72 crore as on June 2021. Not just that, it has been posting losses for the past three financial years.
 
“Tata's financial stability and long term return on investment window of a minimum of 25 years should act as the best catalyst to reviving Air India and getting the airline back on feet. Tata Group intrinsically comes up with the strategic insights that focus on turnarounds, which has been witnessed in the cases of TISCO and Tata Steel where the group transitioned age-old manufacturing units into modern, efficient and market attainable products,” says Mark D Martin, CEO of Martin Consulting.
 
In terms of experience, Tata Group and Singh’s association with aviation is fairly old. The Tata group, for instance, ventured into aviation in 1932 with Tata Airlines (erstwhile Air India) but after the nationalisation in 1953, it went to the government. Tatas were at the driving seat of Air India till as late as 1977. It re-entered the sector with the launch of AirAsia India in 2014 and added Vistara to its portfolio a few months later. Singh has been in and out of the aviation business too. After co-founding SpiceJet in 2005, he sold the airline to Kalanithi Maran in 2010, and then bought it back five years later when it was on the verge of shutting down.

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