Accenture, Ambit bag A-I, Indian merger mandate

MUMBAI: The much-debated merger of the two public sector airlines - Air India and Indian - is set to move forward. Boards of both airlines on Monday awarded the mandate for the proposed merger process to the Ambit RSM-Accenture combine.

The manadate also includes advisory for capital-raising, preparation of business plans, strategic inputs and post integration issues. Eight merchant banking firms were initially in the race, out of which three firms were shortlisted.

The other shortlisted combinations in the race were ICICI Securities-KPMG, JM Morgan Stanley, Amarchand Mangaldas & AT Kearney.

The mandate for the merger, which would potentially create a global scale airline, would be one of the largest mandates in recent times. The valuation of the combined entity is estimated to be at around $5bn to $7bn.

Ambit would help the airlines in valuations, transaction structure and capital-raising opportunities, while Accenture would provide help in terms of impact on strategic issues along with issues of post integration management and drawing up a combined business plan.

Air-India currently operates almost entirely on the international routes while Indian has a combination of domestic and international operations.