Air India (AI, Delhi International) is mulling a joint venture with Lufthansa Technik and Air France-KLM's engineering arm to bid for state-owned Air India Engineering Services Limited (AIESL), according to a report by India's Economic Times.
Operating the biggest Directorate General of Civil Aviation (DGCA)-approved MRO facilities in India, AIESL has a presence at major airports around the country, including Delhi International, Mumbai International, Kolkata, Nagpur, Hyderabad International, and Thiruvananthapuram. Formerly a subsidiary of Air India, the Indian government did not include AIESL in the sale of Air India to Tata Sons in early 2022, a decision which reportedly took the airline's new owners by surprise.
Last month, ch-aviation reported that the government was looking to sell off the Air India subsidiaries they retained after the airline's privatisation. The Indian government, which is yet to formally approve the divestment, is hoping to secure between INR18 billion Indian rupees (USD219 million dollars) and INR19 billion (USD231 million) for AIESL. The mooted sale will involve issuing an expression of interest to invite bids.
Since the sale of AIESL was first announced, Air India has been flagged as a potential buyer. "One of the negative surprises with privatisation is that Air India's engineering capabilities disappeared," CEO Campbell Wilson has said. "AIESL will provide services till the end of next year (2024). But what happens after that is a matter of deep consideration, given our expansion."
This week, Lufthansa Technik said it already had a substantial presence in India, a market it said was growing and "highly dynamic." A spokesperson told the Economic Times they were looking closely at AIESL and were open to increasing their presence in India.
