- Urvashi did mistake againKatrina Kaif is under no pressureIs Puli a match to Bahubali?Ileana on small breakAlia's dad wants her to encash her popularityNimrat has special feeling for AkshayHas Aishwarya sidelined Irrfan Khan from Jazbaa promotions?Varun Dhawan and Natasha enjoy in MaldivesKnow what were Salman’s life changing tips for Athiya ShettyNeha Dhupia lesser known facts
Reigning world tennis champion Novak Djokovic became a new goodwill ambassador for the UN
Government helps Air India to pay debt Last Updated : 09 Oct 2012 11:11:34 PM IST File photo of Air India flight.
The government on Tuesday decided to guarantee Air India's non-convertible debentures (NCDs) worth Rs 7,400 crore, which will pave the way for the ailing carrier to pay off its short-term loans.
"The Ministry of Finance has approved the unconditional and irrevocable guarantee for Air India NCD bonds today for Rs 7,400 crore," an Air India spokesperson said.
Air India is burdened with a huge debt of over Rs 43,000 crore, which is a mix of long and short-term debt and working capital loans.
The airline will now credit rate the NCD bonds based on the guarantee issued by the government. The national carrier was banking heavily on NCDs sale to ease the interest cost on the expensive working capital loans.
"The proceeds of the NCD would be used to repay the short- term working capital facility availed by Air India from the 19 banks," the official said.
The debt-laden national carrier needed to issue the bonds as part of its financial restructuring plan but it had earlier hit a roadblock after the Finance Ministry refused to give "unconditional guarantee".
The NCD would have a tenure of 19 years and priced at a spread over the applicable government security. The government has capped the spread at 70 basis points, the official said.
" Air India would also be able to save on the interest cost by retiring this debt. The Banks would now have a reduced exposure to Air India after the said short-term loan is paid out by the national carrier," he said, adding the airline was targeting to achieve this within two to three weeks from the date of receipt of the sovereign guarantee.
Post Your Comment (0 posted):
We tell you ten reasons to watch Phantom, a must see this week-end.
- Saif Ali does not want Kareena to suffer
- Why Kapil Sharma was the chosen one for Kis Kisko Pyaar Karoon
- Haven't re-shot anything for 'Jagga Jasoos': Katrina Kaif
- 'Phantom' tweet review
- Let’s know about the celebs through their tattoos
- You will make your fathers proud: SRK to Athiya, Sooraj
- No pressure to get married: Gauhar Khan
- I don't like the tag of comedy: Rajpal Yadav
Scientists have discovered that Roman-era Egyptian mummy portraits used the pigment Egypti
Lenovo starts smartphone manufacturing in India.