Hours before the deadline to submit physical bid for Air India (AI), US-based fund Interups has withdrawn from the race, but not completely. It has instead proposed to support the bid by AI employees.
Confirming the development, Interups founder Laxmi Prasad told Moneycontrol that the decision was taken to overcome a legal hurdle.
"We are supporting the employees as they have already filed their physical bid. Filing a separate bid will create a legal gap, and may lead to disqualification of both the bids," Prasad said.
The two bids could have been disqualified as Interups had also offered a majority stake of 51 percent in its consortium to AI employees. Two bids with the same constituents may not have passed muster of the regulations.
Prasad added that he is in talks with the employees, and their representatives. The national carrier's 219 employees had already submitted their bid, Meenakshi Malik, Director, Commercial, earlier told Moneycontrol. She is also part of the bid.
December 29 was the last day to submit the physical bids, 15 days after the deadline to put in Expression of Interest (EoI). Three parties, including Tata Sons, have been confirmed to have put in their interests.
Once the bids are submitted, the government will shortlist the suitors by January 5. In the next stage, bidders will be allowed to conduct due diligence with access to more data and information on the airline.
Talking to media persons later on December 29, Civil Aviation Minister Hardeep Singh Puri said an announcement on the bidders and the bids will be made on January 5. He declined to give further details.
The government had changed many a clause to attract more suitors in its second attempt to sell Air India, in as many years. "The interested bidders have been asked to indicate their interest on enterprise value of Air India," the government has said.
The winner will have to pay 15 percent of the enterprise value in cash to the government. The rest can be taken on as debt.