Billionaire Gautam Adani’s energy and infrastructure conglomerate is considering bidding to buy Air India and is pouring into bid documents before finalising a plan, sources said. The government is offering to sell its entire holding in the loss-making carrier along with its entire interest in its low-cost arm and 50 per cent in the ground handling unit.

Sources with knowledge of the development said the mergers and acquisition (M&A) team of Adani Group is scrutinising Air India bid documents and the interest was at a preliminary stage. Bidding, they insisted, would depend on the due diligence.

If Adani bids, it will join likes of Tata Group, Hindujas, IndiGo and New York-based fund Interups who are said to be considering putting in an expression of interest (EoI) at the close of the bid deadline next month. Adani Group’s spokesperson could not be immediately reached for comments. Sources said Adani sees synergy in Air India and its airport operations. It last year won bids to operate six airports at Ahmedabad, Lucknow, Jaipur, Guwahati, Thiruvananthapuram, and Mangalore. The deciding factor for Adani to bid for Air India would be the debt and losses. The buyer will have to take on a fixed debt of Rs 23,286.5 crore along with certain identified current and non-current liabilities. The airline has been in losses during the last few years.

While the privatization bid document does not place any restriction on Adani from bidding for Air India, Airports Authority of India (AAI) restricts an airline or a group owning an airline to hold no more than 27 per cent in the airports. A similar clause restricting airlines or group owning airlines from owning more than 10 per cent in Delhi airport recently resulted in the collapse of the Tata-GIC group’s investment in GMR.

Air India and its subsidiary, Air India Express own about 120 aircraft at FY18-end and 126 aircraft till September last year. After its unsuccessful bid to sell Air India in 2018, the government this time has decided to offload its entire stake. In 2018, the government had offered to sell its 76 per cent stake in the airline.

Of the total debt of Rs 60,074 crore as of March 31, 2019, the buyer would be required to absorb Rs 23,286.5 crore, while the rest would be transferred to Air India Assets Holding Ltd (AIAHL), the special purpose vehicle.