Air India bids to be allowed on the basis of enterprise value

The central government has announced that it will allow bids for the divestment of Air India on the basis of its enterprise value. The enterprise value to be quoted (market value of debt and equity) will comprise at least 15 per cent in cash payment to the government and debt takeover by the bidders equivalent to 85 per cent of the value quoted. Bidders can also quote a 100 per cent cash payment to the government. The deadline for submission of expressions of interest was extended from October 30, 2020 to December 14, 2020 in order to give more time to the bidders to finalise their plan of action and file queries. The qualified interested bidders will be intimated by December 28, 2020 and will be given some time for submission of financial bids. The centre is keen that the transaction be closed by March 31, 2021.