AI sell off -- IPG mulls legal action

AI sell off -- IPG mulls legal action
ENS ECONOMIC BUREAU

MUMBAI, DEC 18: The Indian Pilots Guild (IPG) has reacted angrily to the government's reported move to disqualify its bid for loss-making carrier, Air India.In a statement, IPG has alleged that `government is unlikely to get the best price as there would be no bidding.'

``The bidding procedure has been reduced to a one horse race, with only Tata-SIA left in the fray as a serious bidder,'' the IPG said.

The IPG had asked the government to consider the employee provident fund of Air-India employees as an indicator of their net worth. "Our gratuity and the provident fund is lying with the government that could be taken as our networth. But we don't have to pledge it to the government like no other bidder would pledge their balance sheet with the government. " said IPG President, Captain Shiv Prasad Varma.

The IPG said it was in talks with a strategic partner for a tie-up to provide the necessary funds to acquire the 40 per cent stake in Air-India before the reported rejection. "Now we have been told by the Morgan Stanley the global adviser to the government of India on Air-India disinvestment to tie-up with some selected bidders till January 31, 2001 but we have no clue about who the selected bidder partner should be since we have not been officially intimated." added Varma.

Asked about whether IPG would go court over the rejection captain Varma said "We are consulting Enterprise Value Enhancementm which is management consulting company, to advise us on the bidding and we would take appropriate legal step after consulting them."

The IPG feels that disqualification of the IPG led employee buy out bid will send out strong signals to all future employee led bids of Public Sector Units coming up for privatisation. "It sets a poor precedent by the government to allow employee participation in the process of PSU disinvestment," the statement added.