The Civil Aviation Ministry has sought Expression of Interest (EoI) from potential...
bidders for a 76 percent stake sale in loss-making Air India as well as divestment of two of the carrier's subsidiaries.
The CMD met representatives from four unions for about 45 minutes to mainly understand apprehensions of employees about the proposed stake sale. The meeting was convened following directions from the ministry, they added.
Representatives from Indian Aircraft Technicians' Association (IATA), Air India Aircraft Engineering Association (AIAEA), Air Corporation Employees' Union (ACEU) and Air India Employees' Union (AIEU) reportedly attended the meeting. These unions mostly represent engineering and commercial staff, among others.
All the four unions are reportedly opposed to Air India disinvestment. The representatives were assured by the CMD that their concerns and apprehensions would be conveyed to the ministry.
In a letter addressed to the CMD, the IATA said it strongly opposes the disinvestment of the airline and its subsidiaries. The union also raised concerns about salary arrears and other issues.
On March 28, the ministry came out with the preliminary information memorandum released on Air India's strategic disinvestment.
As per the memorandum, the government plans to offload 76 percent equity share capital of the national carrier as well as transfer the management control. The proposed transaction would involve Air India, its low-cost arm Air India Express and Air India SATS Airport Services Pvt Ltd, which is an equal joint venture between the national airline and Singapore-based SATS Ltd.
Meanwhile, another media report on April 5 said that the Centre may completely exit Air India by selling its residual stake to Life Insurance Corporation of India (LIC) and other financial institutions. This move would help address investors’ concerns related to possible interference in the airline’s operation, the report added. As part of the privatisation process, the government has decided to disinvest 76 per cent equity stake in Air India Limited, along with Air India’s 100 per cent holding in its subsidiary, Air India Express Limited, as well as 50 per cent in ground handling joint venture AISATS.
A media report said discussions are about to start with LIC and other state-owned insurance companies for selling the government’s remaining stake in Air India after employee stock ownership plans (ESOPs) are given out to the permanent employees.
Subsequent to the ESOP, an employee stock pool will be created, resulting in the government shareholding falling below 20 per cent.
With some financial institutions holding the stake, the Ministry of Civil Aviation will have little oversight over the airline, he said.