Sunday, June 19 2005 09:20 Hrs (IST) - World Time -

Kolkata: The Centre is likely to dilute upto 20 per cent of its stake in the Air India and Indian Airlines, according to Minister for Civil Aviation Praful Patel.

''The thought is that dilution of stake will not be more than 20 per cent. But the Government is in the process of appointing advisors who will recommend the amount of dilution. Their recommendation will be studied before taking an action,'' Patel told newsmen in Kolkata when asked about the roadmap for the proposed IPO.

He said that the dilution of stakes will be done in lines of the Indian Oil Corporation and the Oil and Natural Gas Corporation.

''We do not propose to privatise the companies, but partially dilute the stakes. The companies will remain PSUs. Also, the employees will be made stakeholders,'' Patel said.

Pointing out that Air India has an equity base of Rs 153 crore and Indian Airlines Rs 107 crore, he said both companies needed equity infusion to the tune of 'thousands of crores' to fund expansion projects, including fleet acquisition.

To a question, he said the decision to issue IPO had been approved by the respective boards of the two companies and it will be done this fiscal.