Published on Mon, Oct 08, 2007 at 09:25 | Source : Moneycontrol.com
Updated at Mon, Oct 08, 2007 at 15:31
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National Aviation Company may divest 15% via IPO
The newly-created holding company for national carriers Air India and Indian, National Aviation Company of India (Nacil), may offload 10-15% stake through an initial public offering (IPO) in 2008 to fund expansion and take on competition from private airlines, civil aviation minister Praful Patel said.
Mr Patel also said an empowered group of ministers examining the draft civil aviation policy will meet later this month and is expected to reach a conclusion on the rules governing qualifications to fly overseas. The criterion requiring five years of domestic service only allows Air India and Jet to fly abroad as of now. Newer private airlines want this rule to be relaxed so they too can commence overseas operations.
Furthermore, the limit on foreign direct investment (FDI) is also likely to be increased in select segments, but foreign airlines will not be allowed to take over Indian carriers just yet. 'Why should they be gobbled up by international carriers?' Mr Patel asked.
Cabinet approval will be sought to allow 100% FDI in helicopter operations, seaplane companies, pilot training and maintenance, repair & overhaul (MRO) facilities. The foreign investment cap on cargo operations could be raised to 74%. India currently allows up to 49% FDI in most segments of civil aviation, barring airports, where the ceiling is 74% for existing ones and 100% for greenfield projects, reports The Economic Times.
