The government-owned IDBI Bank said it is negotiating with other entities to give national carrier Air India a loan of $1-billion to help the airline acquire 12 aircraft mainly for domestic operations.
"We are syndicating the $1-billion loan for Air India. The process is already started. The loan will be arranged in the shortest possible time," IDBI Bank Deputy Managing Director Jitender Balakrishnan told PTI here.
Air India, which is owned by the National Aviation Company of India, said it is expected to materialise the deal soon. The airline intends to use the loan amount to purchase 12 out of the 43 aircraft it plans to acquire, including A-319, A-320 and A-321.
IDBI Bank is acting as the lead arranger for the fund raising programme. Over 10 banks are understood to be part of the consortium, the size of which is likely to be expanded, with more lenders coming forward to participate in the deal, Balakrishnan said.
It is understood that the loan amount would be equally divided among lenders in the consortium with a view to reduce the financial burden on individual banks.
IDBI Bank had recently extended Rs 300-crore loan to the beleaguered Satyam Computer, helping the IT-firm's newly appointed board to fulfill its near-term requirements.