Air India to put foreign assets on the block

Air India is considering selling off its properties in foreign destinations such as Hong Kong, Nairobi and Mauritius as part of asset monetisation to garner resources. The national carrier has started approaching Indian banks and public sector undertakings for disposal of these properties, including floor space in prime locations, airline officials said.

They said the Indian High Commissions at these places have also been approached to help the airline find suitable buyers for the assets.     

The plan to monetise real estate assets is an important ingredient of Air India’s financial restructuring and turnaround plans, under which the airline aims to raise an estimated Rs 5,000 crore over a period of 10 years, with an annual target of Rs 500 crore from 2013-14.

MONETISATION PLANS

• The airline is considering selling off its properties in cities such as Hong Kong, Nairobi and Mauritius
• Rs 5,000 cr is the amount that the company aims to raise over a period of 10 years under its financial restructuring and turnaround plans
• Rs 500 cr is the annual target the company is looking at from 2013-14 onwards
• The national carrier has started approaching Indian banks and public sector undertakings for disposal of these properties including floor space in prime locations
• The Indian High Commissions Hong Kong, Nairobi have also been approached to help the airline find suitable buyers for the assets

The airline has already chalked out plans to monetise its unutilised or surplus immovable assets over the next few years, the officials said, adding properties in several cities — including Delhi and Mumbai are already in the process of either being sold, or leased or rented out.     

Air India was also exploring other avenues for generating ancillary revenues, including leasing out space in some of its booking offices for banks to install ATM outlets. The airline plans to start with leasing out office space in Delhi and Mumbai, and then extend it to cities in South India, the officials said. As part of reducing distribution and marketing costs, the national carrier was also looking at enhancing its revenue through web-sales which at present contributes up to 20 per cent of its total sales.     

To push up online business, discounts were also offered for a short while on web sales on international sectors.