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August 21, 2001
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Money > Business Headlines > Report August 21, 2001 |
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Tata-SIA reviewing Air-India deal viabilityPuja Mehra The Tatas and Singapore Airlines are reconsidering their bid for the 40 per cent government stake in Air-India. The SIA-Tata consortium, the sole bidder left in the fray for the state-owned carrier, on Monday admitted for the first time that it is reviewing its offer for Air-India. "The consortium is weighing the commercial viability of the business transaction," senior Tata executives told Business Standard. Over the past two weeks, there have been several reports that SIA may withdraw its offer for A-I. SIA had all along refrained from a categorical denial saying that it had neither withdrawn its bid nor had made a final offer. The Tatas, however, had all along emphatically denied the reports. SIA has already sent a written communiqué to the Tatas clarifying its position on the bid. The Tatas had earlier asked their foreign partner to take a final decision on the transaction. The Tatas are now close to reaching a conclusive decision on the offer to be made to the government for Air-India. The consortium would convey its final decision to the government shortly, the Tata executives said. The Tata-SIA consortium is a 51:49 joint venture in which the Tatas, being the Indian partners, are the majority stake holders. The exact reason for the combine having second thoughts on the offer for A-I has also been a subject for wide speculation. The factors however, could not be ascertained reliably. On August 7, the Tatas had in a faxed reply to Business Standard said "many issues relating to the transaction are discussed between the partners," when queried if SIA had shared concerns with them about A-I divestment not going through due to political or other reasons. They did not, however, explain these issues. They had also said that the consortium had no differences on the valuation aspect of the airline. "The consortium worked jointly on the due diligence and the approach on the transaction was jointly evolved," they had said. Responding to another question, the Tatas had said that they had not received any complaints from SIA about the government being indifferent to any issues raised by the latter. Powered by YOU MAY ALSO WANT TO READ:
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