Civil Aviation Minister Hardeep Singh Puri on Thursday said bidding for Air India would be done on the basis of its enterprise value instead of equity value. The enterprise value of a company includes the equity value, debt as well as cash with the company. Equity value measures the value of a company's shares. "We have decided to ask for bids for Air India on enterprise value," Puri said at a press conference.

Aviation Secretary Pradeep Singh Kharola said at the conference, "The bid will be on the enterprise value... In this enterprise value also, a ratio has been earmarked between how much he (bidder) can take as debt and how much he has to give as cash." It has been decided that whatever enterprise value the bidder quotes, 15 percent of that has to be given in cash to the government and the remaining 85 percent has to be taken as debt along with Air India, Kharola explained.

The debt of Air India as of March 31, 2019, was Rs 58,255 crore. Later in 2019, Rs 29,464 crore of this debt was transferred from Air India to a government-owned special purpose vehicle called Air India Assets Holding Company Limited (AIAHL).

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