After completing the significant Air India privatisation process, the government will now start work on monetising its four other subsidiaries, including Alliance Air, and over Rs 14,700 crore worth non-core assets like land and building, Secretary in the department of investment and public asset management (DIPAM) Tuhin Kanta Pandey said.

The government on October 8 had announced that salt-to-software conglomerate Tatas have won the bid to acquire debt-laden national carrier Air India for Rs 18,000 crore.

This includes a cash payment of Rs 2,700 crore and taking over Rs 15,300 crore debt. The deal, which is expected to be completed by December-end, also includes sale of Air India Express and ground handling arm AISATS.

Mr Pandey told agencies that his department will now get down to working out a plan for monetising the subsidiaries of Air India which are with the special purpose vehicle AIAHL and setting off the liabilities.

“There will be a plan for monetising the assets of Air India Assets Holding Limited (AIAHL). It is a very big task again of clearing of AIAHL liabilities and disposal of assets. In AIAHL there is a company of ground handling, engineering and Alliance Air which have to be privatised,” said Pandey, who spearheaded Air India privatisation.

“It (sale of subsidiaries) could not be started because these all are intimately linked. Unless and until Air India goes, we could not proceed with other things,” he added.

As a precursor to Air India sale, the government in 2019 had set up a special purpose vehicle (SPV) — AIAHL — for holding debt and non-core assets of the Air India group.

Four Air India subsidiaries - Air India Air Transport Services Limited (AIATSL), Airline Allied Services Limited (AASL), Air India Engineering Services Limited (AIESL) and Hotel Corporation of India Limited (HCI) - along with non-core assets, painting and artefacts, and other non-operational assets, was transferred to the SPV.

Air India had a total debt of Rs 61,562 crore as on August 31. Of this, Tata Sons holding company Talace Private Limited will take over Rs 15,300 crore and the remaining Rs 46,262 crore will be transferred to AIAHL.

Besides, non-core assets of Air India including land and building, valued at Rs 14,718 crore, are also being transferred to AIAHL. Further, liabilities of Rs 15,834 crore towards dues to operational creditors, like those for fuel purchases, as of August 31 would be transferred to AIAHL.

Pandey said between September 1 and December 31, 2021, just before closing the deal, the government will work out a balance sheet of Air India.