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Hindujas, Videocon to bid for 26 per cent of Indian Airlines

The UK-based billionaire Hinduja brothers and Indian consumer electronics company Videocon International are among the suitors who will bid on Friday for 26 percent of domestic carrier Indian Airlines.

"We are putting in a technical bid," Videocon International's director Kuldeep Drabu said.

A Hinduja spokesman also confirmed that the brothers, three of whom are facing trial in India in the Bofors arms scandal, will table a bid.

The government has set February 23 as the deadline for consortia to finalise their partners and submit bids for the stakes the government is selling in domestic carrier Indian Airlines and long-haul airline Air India.

The deadline for forwarding expressions of interest (EoI) for the two state-run airlines passed last November.

The government is selling a 26 per cent stake in Indian Airlines to domestic companies, non-resident Indians and foreign companies with majority ownership by expatriate Indians.

Foreign airlines are barred from investing in Indian Airlines, which draws two-third of its revenue from domestic routes.

Indian Airlines also flies to countries in the Middle East and to Southeast Asian cities like Singapore and Bangkok.

FATAL CRASH IN JULY

The airline, which has a fleet of 52 aircraft including 30 Airbus A 320s, posted small profits for the three years to last March. But a crash in July, which killed 58 people and raised questions about the state of the airlines' ageing fleet, has since pushed the carrier into the red.

It posted a net loss of Rs 1.37 billion ($29.4 million) for the past April-October half, against a profit of Rs 143.5 million in the same period a year earlier.

Private-sector rival Jet Airways, with a young fleet of 25 Boeing 737s, has been snapping at Indian Airlines heels, eroding its dominant market-share.

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