Serious corrections may be needed in the bid conditions of Air India after Jet Airways and IndiGo opted out of the divestment of the national airline, said a senior aviation analyst.
After IndiGo's decision to opt out last week, newspaper reports on Tuesday said Jet Airways will also stay away from the disinvestment of the national airline.
While saying that the divestment was a good move and 'long overdue', Amber Dubey tweeted, " Unfortunate to see India’s Big 2 dropping out at the EoI stage itself. Serious corrections required in bid conditions."
Dubey is partner and India head of aerospace and defence, KPMG.
The developments will be a blow for the government.
"We welcome the government move...however, considering the terms of offer in information memorandum and based on our review, we are not participating in the process," Jet Airways Deputy Chief Executive Officer Amit Garwal told Business Standard.
Earlier on April 5, IndiGo had revealed its stance in a BSE announcement.
The country's largest airline by domestic share was hoping that the government demerges the domestic operations of Air India, enabling IndiGo to bid for just the international business of the national airline.
But the government has decided to sell Air India, Air India Express and the ground handling unit, AISATS, together.
The other big stumbling block for potential bidders has been the higher than expected debt the new owner of Air India will have to take on.
The preliminary information memorandum (PIM) released by the Ministry of Civil Aviation on March 28, noted that Air India's buyer will have to take on debts of Rs 33,392 crore.
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