The Finance Ministry has approved the unconditional and irrevocable guarantee for Air India’s non-convertible debentures (NCDs) worth Rs.7,400 crore.

The NCDs will have tenure of 19 years and priced at a spread over the applicable Government Securities.

The government has capped the spread at 70 basis points. The NCD proceeds will be used to repay the short-term working capital facility availed itself of by Air India from the 19 banks, the airline said in a statement.

More In: Companies | Business