State-owned, Air India Ltd. in a tender document on Wednesday said that the airline company is planning to raise Rs 6,150 crore via short-loan from domestic lenders by the end of November month.
The proceeds of the loan would carry a sovereign guarantee and will be used for refinancing foreign currency bridge loans taken to buy seven Boeing 787 and 777 aircraft. Air India will repay the loan in a year and is also offering aircraft such as Boeing 787 and 777 as collateral for the loan.
According to the bid document, the airline company would raise the total loan amount in seven tranches, out of which three tranches would consist of Rs 790 crore each, another three tranches of Rs 925 crore each and one tranche of Rs 1,005 crore.
The interest rate payable by the Air India would be linked to “MCLR/GSEC rates with reasonable spread as margin”. The MCLR (Marginal Cost of funds-based Lending Rate) is a tenor-linked with the internal benchmark. It is determined by the bank which depends on the period left for the repayment of a loan.
Last month, the government has revised the terms for selling the debt-laden carrier by offering it on its enterprise value and the bidders can quote the level of debt which they are comfortable with.
Currently, the national carrier’s liabilities and provisions includes short-term loans and trade payables of Rs 70,686.6 crore and a net debt of Rs 58,255 crore at the end of financial year 2019. However, the government has transferred its debt of Rs 29,464 crore to a state-owned special purpose vehicle, Air India Assets Holding Company Ltd.