Tata Group's airport plans hit ownership hurdle

Tata Sons' plans to make another big splash in the aviation space have been hit due to ownership hurdles. CNBC-TV18's Aastha Maheshwari says Tata Group which was planning to bid for 100 percent stake in Chennai airport has represented to the government on a cross ownership clause in the RFQ, which may not allow Tata Group arm, Tata Realty and Infrastructure, to participate in the bid at all.
According to the request for qualification, the SPV which is planning to bid should not include any equity ownership of scheduled airline, cargo airline, or associates in excess of 10%. This condition shall be deemed to form part of the Joint Bidding Agreement. And since Tata Sons, the holding co of TRIL , has recently entered into a 51% joint venture with Singapore Airlines recently, TRIL as a subsidiary of Tata Sons will become as associate of the airline and thus will not be able to bid. The government had allowed privatization of six airports in August this year. Tata Group's interest in this clearly comes at an appropriate time, considering that the Tatas have announced their two airline joint ventures (JVs), one with Air Asia and one with Singapore Airlines recently.
Read News In Full 05/12/13 Aastha Maheshwari/CNBC-TV18