Tuesday, December 27 2005 20:05 Hrs (IST) - World Time -

Mumbai: Air-India has floated two tenders for interim loans to raise $429 million from banks for advance payments of the multi-billion aircraft acquisition plan of the national carrier.

"We have invited tenders and January 6, 2006 is the last date for submitting bids. By the end of January, we will finalise the bank, from where we will take the loan," A-I General Manager S Venkat told sources here today (Dec 27, 2005).

The tenders, include a $306 million for A-I while another USD 123 million for its low-cost subsidiary, Air-India Express.

"We have to make an advance payment for the first 22 aircraft which will be delivered between 2006 and 2008. This includes, 12 Boeing 737-800s for A-I Express and five Boeing 777-200LR and 11 B777-300ERs for A-I," he said.

The loans will have a six-month tenor, which may be raised in national or foreign currency or a mix of both, he added.

This loan would meet about 15 per cent of the total cost of the fleet acquisition while the remaining would be on the bank guarantee from the Exim Bank, Venkat said.

The airline is also planning to tap capital market with an initial public offer next year to fund the expansion plans.

An empowered Group of Ministers (eGoM) last week had cleared the A-I's aircraft acquisition plan from the US aerospace firm Boeing Co. valued nearly Rs 35,000 crore.

A-I will be buying 68 Boeing aircraft including 27 Boeing 787, eight B 777-200 LR and 15 B777-300 ER aircraft for A-I and 18 Boeing 737-800 aircraft A-I Express.