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Monday, 13 November, 2000, 10:08 GMT
Big names circle Air India
Air India aircraft
The bidding process is taking off
Several of the world's leading airlines have submitted bids for a stake in India's flag carrier, Air India.

The airline is being privatised after nearly five decades of government control.

Privatising Air India
Equity on sale is 60%
Foreign airlines can bid for 26%
Foreign airlines with an Indian partner can bid for 40%
Air India employees will get 10%
Financial institutions will get 10%

Singapore Airlines, Air France, Delta Airlines, Emirates and British Airways are among those said to have placed their bids before the Friday deadline.

The Indian government is selling a total of 60% of the airline - of which foreign buyers can bid for 26%, or 40% if they tie-up with an Indian partner.

A further 10% stake will be sold to Air India employees and 10% to financial institutions.

Range of bids

Singapore Airlines (SIA) has made a joint bid with India's Tata group, which owned Air India before it was nationalised in the 1950s.

"SIA's airline operating competency will be a significant asset to the consortium and critical in ensuring the success of Air India in the international market place," Tata Group chairman Rata Tata told French news agency, AFP.

Air France and Delta Airlines, part of the Sky Team Alliance, are reported to have put in a joint bid for a 26% stake.

The Dubai-based Emirates Airways was said to have place its bid for a 26% stake almost two weeks ago.

The UK-based Hinduja Group, owned and run by four billionaire Indian-born brothers, is also believed to be in the fray.

A bid has also been made by Air India pilots.

British Airways

British Airways and Qantas have teamed up as "advisers" in a consortium including LNM Group, owned by London-based steel magnate LN Mittal, and Kotak Mahindra Finance, which is affiliated to Goldman Sachs.

Rival UK airline Virgin Atlantic decided against a bid.

Air India's earnings before interest, tax, depreciation and amortisation stood at 5.93bn rupees ($128m) for the year ended 31 March 2000.

The airline posted a net loss of 380m rupees ($8.2m) in the period.

The airline has a fleet of 23 aircraft and employs about 18,000 people.

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See also:

19 Oct 00 | South Asia
Pilots plan Air India bid
26 May 00 | South Asia
Privatisation plans for Air India
10 Jul 00 | Business
Virgin and BA eye Air India
01 Jun 00 | South Asia
Air India hunts for partners
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