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Pilots' bid for Air India rejected

An official, who did not want to be identified, said the pilots' union as well as the two other bidders were disqualified as they did not fulfil a minimum net worth criteria of $225 million.

The bid by the pilots' union was rejected as they projected their net worth on the basis of provident fund contributions of employees, which was opposed by other labour factions within Air India.

A government statement on Friday said three bidders for a stake in Air India did not fulfil the required criterion, but did not name the firms that were disqualified or those short-listed.

The statement said the qualified bidders for the two carriers would be given until January 31, 2001 to submit their technical proposals containing details of their business plans.

Those who had bid for Air India included the Tata group and Singapore Airlines, Air France and Delta Airlines, and the Hinduja group and London-based steel magnate L N Mittal.

Airline sources said the Tata-Singapore Airlines combine was definitely in the running.

The government plans to sell a 60 per cent stake in Air India, which has piled up losses of Rs 10 billion in the past five years.

Forty per cent will be sold to a 'strategic investor' - which would include a maximum 26 percent stake for a foreign airline - and 20 percent to employees and financial institutions.

The airline has a fleet of 23 aircraft, but has route entitlements in vital sectors such as Europe, United States of America and the Middle East.

The government also said two bidders for a 26 per cent stake in domestic carrier Indian Airlines had also been rejected, but did not specify any names.

The Tata group and consumer goods giant Videocon were among those who had submitted bids for the domestic carrier.

EARLIER REPORT
Air-India suitors to be quizzed about business plans: Reuters

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