US-based fund Interups has backed out of the race to acquire Air India.
The fund, which has targeted several stressed assets in India, was looking to partner the airline’s employees for the bid. But with the employee consortium refusing to join hands, Interups has withdrawn its expression of interest (EoI).
Interups Inc Chairman Laxmi Prasad confirmed the development to Business Standard but did not elaborate.
In his LinkedIn post, Laxmi Prasad said, “We are not filing our physical bid for Air India today — we have rather chosen to support the employees who already have filed their bid, as we are offered an opinion that filing a separate bid with same affiliation may disqualify the interested bidder and this legal fallacy will leave only one potential bidder. Under no circumstances we would wish this happening.”
The government has received multiple EoIs to take over the debt-ridden national carrier. Along with 100 per cent stake in the airline, the government is also selling its low-cost subsidiary Air Indian Express.
Tata Sons is the front runner to acquire the airline. A group of 219 Air India employees, led by its Commercial Director Meenakshi Malik, has submitted an offer too. The employees have a teamed up with a financial investor. The shortlisted bidders will be announced on January 5. The bid by Interups had proposed a 51 per cent stake to the Air India Employee Association, while the remaining 49 per cent was proposed to be with the fund. It had also promised to invest billions of dollars in the Indian aviation sector.
Interups, which has a market capitalisation of $28 million, has earlier unsuccessfully bid for bankrupt firms such as Lavasa Corp, Asian Colour Coated Steel and Reliance Naval. Air India made a cash loss of Rs 3,600 crore in the last fiscal year, its Chairman Rajiv Bansal said on Tuesday.
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