Air India may mortgage an aircraft to raise $1.15 bn loan

NEW DELHI: Cash-starved Air India will now float a fresh tender to raise $1.15 billion for refinancing its aircraft purchase loan, but the national carrier’s hopes hinge largely on support from the finance ministry and not the attractiveness of the offer itself.

The airline will make an offer to banks in about four to five weeks with an aircraft as the most-likely collateral to the lender, though the airline says it could be a government guarantee as well, but not both. “We are floating the tender afresh since only one level of security is proposed to be offered — either the government guarantee or the aircraft,” the airline told ET in an emailed response. The civil aviation ministry has made its stand clear that since Air India has not defaulted on any interest payments, a double guarantee was......

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