Group of employees excluded from Air India tender process

A consortium of Air India employees was excluded from the bidding process to take over the airline. The consortium, led by board member Meenakshi Mallik, yesterday released a statement explaining why it was not eligible. The latest elimination means that the bidding process is now limited to the last applicants.

Air India 777-300ER
The government hopes to complete the privatization process by the next fiscal year (before April 2022). Photo: Vincenzo Pace | Simple theft

Employees outside

The race to buy Air India continues to narrow. This week, a consortium of Air India employees was shut out of the privatization process by the government for failing to respect the terms of the sale.

The consortium was led by Air India’s Commercial Department Manager Meenakshi Mallik, and represented 209 employees. The employee’s offer was also backed by investment firm Interrups, which pulled out of the sale in December.

Delhi Air India Airport
The Air India employee consortium failed to qualify because its overseas partners failed to provide the necessary documents. Photo: Getty Images

According to a statement seen by Mint, the offer was ruled out due to issues with foreign investors in the consortium, a Seychelles-based financial fund. The statement sets out three reasons for the failure of the offer, all of which relate to failing to provide the required documents or not qualifying as a “regulated foreign investment fund” as defined by the process.

However, Ms Mallik was quick to point out that the government had no problem with the employee group’s comments, saying:

“It was certainly upsetting to read this, but what I found reassuring about the email was that the government had no objections or reservations about the documentation provided on behalf of the employees.

“This can only mean that the employee documentation was, in fact, perfect, which clearly reflects not only our sincerity in the process, but also our competence in having participated and, if selected, in running our airline. “

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Last two

Air India’s race has probably narrowed down to two competitors: the Tata Group and SpiceJet CEO Ajay Singh. However, the government previously removed the deadline for publicly announcing bidders, which means that it is possible that other bidders may be involved.

Based on the information available, it is very likely that Tata and Ajay Singh (not as CEOs of SpiceJet but rather in their personal capacities, according to Business Today) are the airline’s top bidders. They will soon have access to Air India’s internal details to perform due diligence and present their offer.

SpiceJet MD Ajay Singh ahead of SpiceJet
The CEO of SpiceJet has reportedly partnered with two financial firms to bid for Air India on an individual basis. Photo: Getty Images

The government originally planned to complete the sale process by this fiscal year (ending March 31). Now the process is scheduled to be completed within the next year, if all goes well. However, given the repeated delays in the process, don’t expect a final winner for the next few months.

Who do you think will take over Air India? What will the airline look like in the future? Let us know in the comments!