According to a report in the Economic Times, the lender of Air India has provided Rs 35,000 crore to Talace promoted by the sons of Tata. As Talace won the bid for Air India, it invited the airline’s existing lenders to provide a one-year general loan of Rs 23,000 crore. The weighted average rate of return is 4.25%.
“Considering that the loan is unrated and unsecured, but priced close to sovereignty, this is an overwhelming response,” an executive from one of the lenders told the Economic Times. Commercial banks including the State Bank of India, Bank of Baroda, Union Bank of India and Punjab National Bank have approved credit lines ranging from 12,000 crore to 3,000 crore.
Talace bid 18,000 crore when it won the bid. Tata will pay 2,700 crore in cash and will assume 15,300 crore debts of the airline. According to the report, as of August 31, Air India’s total debt was 61,560 crore. Tata may notify lenders about the distribution in the first week of January.
Complete News Source : UP Turn
