The Air India divestment process is expected to reach its completion on Thursday, 27 January, news agency ANI reported, amid media reports of further delays in the process.
"Officially Air India hands over to Tata Group today in the afternoon. Tata Group Chairman N Chandrasekaran will be in the ministries for the official handover process," a senior government official told ANI.
After Tata Sons won the bid for the state-run carrier in October, it was settled that the handover of the company would be finished by December 2021.
However, pending approvals and unresolved dues of the debt-ridden airline posed hindrances to the process, delaying the culmination of the transfer by a month.
Here's what we know about the delays in the transfer process.
Pending Approvals, Formalities Cause Delay
Following Tata's victory in the Air India bidding on 8 October, the Centre on 25 October had signed the share purchase agreement (SPA) for the deal.
The conditions of the SPA provided that all formalities relating to the handover be concluded within two months, but the period can be protracted if the buyer and seller mutually agree.
The process was, then, initially scheduled to finish by the end of December.
In December, however, the divestment was postponed by a month to January 2022. At the time, certain regulatory approvals were pending for the handover, and some formalities remained unfinished, an official had told news agency PTI.
On 24 January, the Air India administration indicated that the balance sheet for the airline had been closed and provided to Tata on Monday, and will be reviewed by the new owners till Wednesday.
Air India's Director of Finance Vinod Hejmadi, in an email to the company's employees, had said, "The closing balance sheet as on 20th Jan has to be provided today 24th Jan so that it can be reviewed by Tatas and any changes can be effected on Wednesday," the internal communication stated, news agency ANI reported.
According to The Indian Express, there was a delay in finalising the balance sheet as it is supposed to account for the Rs 20 crore loss that the airline claims to sustain on a daily basis.
Moreover, various ministries and departments under the central government had pending payments amounting to Rs 278.49 crore to Air India till October last year, which will have to be settled. This includes dues from the prime minister’s flights of Rs 7.20 crore and the president’s flights of Rs 6.14 crore, The Indian Express reported, citing an RTI response.
The airline's handover to the Tata Group, scheduled for Thursday, 27 January, reportedly saw further hindrances.
According to a Times of India report that cites Air India sources, a final piece of documentation from Ireland – a no objection certificate from the lessors of some aircraft – was still awaited on Wednesday night.
Tata's Acquisition of Air India
Tata Sons had emerged as the winning bidder for state-run airline at a bid of Rs 18,000 crore on 8 October, after four years of efforts by the Indian government to find a buyer for its beleaguered national carrier.
Talace, a subsidiary of Tata Sons, had acquired the Air India whose reserve price was pegged at Rs 12,906 crore by valuation advisors to the central government.
The winning bid of Rs 18,000 crore comprises of taking over of 15,300 crore of the debt incurred by the airline; the remaining Rs 2,700 crore will be paid to the government.
Notably, business tycoon JRD Tata had founded the airline and had piloted the first flight in 1932.
"The Tata Group winning the bid for Air India is great news! While admittedly it will take considerable effort to rebuild Air India, it will hopefully provide a very strong marketing opportunity to the Tata Group's presence in the aviation industry," the group's former chairperson Ratan Tata said in a statement, after the acquisition was announced.
(With inputs from PTI, ANI, and The Indian Express)