Scouting for funds, Air India is in advanced discussions with public sector lender SBI for sale of at least two residential properties that could net nearly Rs 50 crore, airline and banking sources said. While the government moves ahead with the process for strategic stake sale, the loss-making airline continues to work on the strategy to divest non-core assets.
Saddled with more than Rs 50,000 crore debt, Air India recently sought loans worth over Rs 1,500 crore to meet working capital requirements. Against the backdrop of the severe financial crunch, the airline’s talks with the State Bank of India (SBI) assumes significance in terms of raising additional monetary resources.
The discussions between Air India and SBI are at an advanced stage with respect to sale of two residential properties in South Mumbai, sources told PTI. While the final contours of the deal are being worked out, an airline source said the sale is expected to fetch around Rs 46 crore.
Despite trying to dispose of such assets, so far Air India has managed to sell only four of its flats in Mumbai to SBI for Rs 90 crore. These properties are located at upmarket Peddar Road in South Mumbai.
The carrier has been in possession of some properties which are lying vacant and unused for a long time. These include parcels of land as well as residential and commercial estate in India and abroad. Among others, the carrier has leased out almost the entire space at its previous headquarters at Nariman Point to various government agencies.
As per the turnaround or financial restructuring plan approved by the Cabinet Committee on Economic Affairs (CCEA) back in 2012, Air India is required to monetise its assets and generate Rs 5,000 crore by way of sale, leasing or developing an asset as a joint venture. Under the plan, the carrier is to get financial assistance to the tune of Rs 30,000 crore over a 10-year period.