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Etihad sends feelers to Anil Ambani to buy 76% stake in Air India

Sources aware of the discussions said talks were at a preliminary stage

Arindam Majumder & Aneesh Phadnis  |  New Delhi/Mumbai 

Air India

airline major is planning to bid for state-owned carrier is looking for partners in major Indian corporate groups and has sent feelers to Anil Ambani-owned group (ADAG).

The Union government has invited expression of interest from private players to buy 76 per cent in the national carrier. The sale includes 100 per cent in subsidiary Express and 50 per cent in ground handling joint venture AISATS.

Sources aware of the discussions said talks were at a preliminary stage. “is scouting for partners to form a consortium to bid for and is in discussion with companies, including the group,” a source said. There are chances that the talks may not translate into a partnership, but this indicates interest of foreign aviation firms and India Inc in the airline.

According to sources close to the transactions, several global airline majors such as British Airways and Singapore Airlines are evaluating investment prospects in Air India and looking for suitable partnership for the deal.

If the partnership works, this will be Etihad’s second investment in an Indian airline.

In 2007, it had bought 24 per cent stake in private airline Jet Airways.


“Relations with Jet Airways are not at an optimum level following Jet’s deepening of partnership with Air France-KLM. But Etihad will not let its hold in the Indian market go, so it is evaluating the opportunity,” another source said.

According to the agreement signed last November, the joint venture between Air France-KLM and Jet Airways is meant to share passenger traffic revenue on the India-Amsterdam and India-Paris routes. In an advanced form of commercial partnership, this will also involve closer tie-ups in sales and marketing, including common corporate and travel agency contracts.

Media reports indicate had earlier explored opportunity to start an airline on his own or through investment in an existing carrier.

Queries sent on Wednesday to and Etihad did not elicit any response till the time of going to press on Thursday night. However, a source in the group said it was unlikely that the group would bid for Air India given its precarious financial conditions. At a time when the financials of the group are not strong, it may not get into a new stream of business, he said.

Aviation consultancy firm CAPA said Etihad would soon sell its stake in Jet Airways. The two carriers had, however, denied any such steps.

The government had mandated certain net worth conditions for becoming eligible to bid for Air India. The group, despite suffering huge losses, qualifies the eligibility criteria.

The sale of Air India was off to a slow start with two listed domestic airlines ruling out bidding for it.

While IndiGo expressed its inability to acquire Air India’s domestic operations, Jet Airways cited high debt of the airline as the possible reasons for staying out of the race.

First Published: Fri, April 13 2018. 02:31 IST