Mumbai, Nov 20 (PTI) Debt-ridden Air India has revived its plans to raise Rs 500 crore in short-term loans (STLs) besides mopping up another Rs 6,100 crore by way of sale and lease back of seven of its wide-body planes, including six Boeing 787 (Dreamliner) aircraft, an airline official said. Also Read - How The 'Heroic' United Airlines Pilots Safely Landed Boeing Plane After Its Engine Burst Into Flames
In early September, the airline had invited bids for raising Rs 500 crore through STL to meet its working capital requirements with September 10 as the deadline for submission of bids. Also Read - IAF Soon to Get F-15EX Fighter Jet as Boeing Gets US Government's Approval to Offer it to India
However, the deadline was extended to October 31 after it failed to get any response. Also Read - International Flights: Vistara Becomes First Indian Airline to Offer in-Air WiFi Services From Friday
At the same time, Air India managed to get Rs 1,000 crore from the National Small Savings Fund (NSSF) as loan and subsequently the plan to raise Rs 500 crore was put on hold.
“We did not pursue the proposal to garner Rs 500 crore in STL after receiving Rs 1,000 crore from the NSSF. We have now decided to resume the process once again,” said a senior Air India official.
Sitting on a debt pile of Rs 55,000 crore, which include Rs 35,000 crore towards working capital loans, the carrier has been struggling to raise funds since last year.
Meanwhile, it last week came out with invitation of offers for sale and lease back (SLB) of seven planes – six B787-800 and one B77-300 ER – to raise as much as USD 856 million (around Rs 6,100 crore) for repayment of the bridge finance against these planes.
Besides 12 B777s, Air India has 27 B787-800s in its fleet. Of these, 21 Dreamliners are already operating under the SLB mode.
Under the SLB arrangement, the seller of an asset leases it back from the purchaser for a longterm period and continues to use it without actually owning it.
“AI would sell the aircraft to the lessor and immediately lease the same back under operating lease for a period of up to 12 months with an option to extend by three more years at a mutually negotiated price,” as per the bid document.
The SLB transaction will be supported by the Government of India guarantee in favour of the bank/ institution/lessor, according to the document.
The last date for submission of technical and financial bids is December 10, it said.
As part of its fleet expansion plan, the national carrier had in 2005 placed orders with Boeing for 68 aircraft 27 Dreamliners, 15 B777300ERs, eight B777200LRs and 18 B737800s. All these aircraft have already been delivered to the carrier.
The carrier is staying afloat on a bailout package extended by the government in 2012, as part of a turnaround plan and a financial restructuring plan. Air India is to receive a budgetary support of Rs 30,231 crore over a 10-year period ending March 2021.
In June also, Air India borrowed short-term loans worth Rs 1,000 crore to pay staff salaries and meet other obligations, following a failed privatisation attempt.
This is published unedited from the PTI feed.