Begin typing your search...

Vistara merges with Air India

With a combined fleet of 218 aircraft, emerged entity becomes India’s largest intl carrier and 2nd largest domestic carrier; Singapore Airlines hold 25.1% stake in enlarged airline, will invest Rs2,058.5 cr in AI as part of the transaction

Vistara merges with Air India
X

Vistara merges with Air India

  • Whatsapp
  • Telegram
  • Linkedin
  • Print
  • koo
  • Whatsapp
  • Telegram
  • Linkedin
  • Print
  • koo
  • Whatsapp
  • Telegram
  • Linkedin
  • Print
  • koo

Spreading Wings

- SIA and Tata Sons will participate in addl capital injections

- Tata Sons aims to make AI a truly world-class airline

- Will fund growth and operations of enlarged Air India until 2024

- SIA intends to fund any capital injections with its $17.5-bn internal cash resources

New Delhi: In a major consolidation in the Indian aviation space, Tata group on Tuesday announced the merger of Vistara with Air India (AI), and pursuant to the deal, Singapore Airlines will have a 25.1 per cent stake in Air India. The proposed deal is expected to be complete by March 2024, subject to regulatory approvals. Tata group owns a 51 per cent stake in Vistara and the rest is with Singapore Airlines (SIA).

In a release, SIA said Vistara and Air India would be merged, and it would also be investing Rs 2,058.5 crore in Air India as part of the transaction. "This would give SIA a 25.1 per cent stake in an enlarged Air India group with a significant presence in all key market segments. SIA said it intends to fully fund this investment with its internal cash resources, which stood at S$17.5 billion as of September 30. In a separate release, Tata group said that with the consolidation, Air India would be the country's leading domestic and international carrier with a combined fleet of 218 aircraft, making it India's largest international carrier and second largest domestic carrier."

SIA and Tata Sons have also agreed to participate in additional capital injections, if required, to fund the growth and operations of the enlarged Air India in FY2022-23 and FY2023-24. "Based on SIA's 25.1 per cent stake post-completion, its share of any additional capital injection could be up to Rs50,200 million (S$ 880 mn, US$ 615 mn), payable only after the completion of the merger," SIA said in the release.

The actual amount will depend on factors, including the progress of the enlarged Air India's business plan, and its access to other funding options. SIA intends to fully fund any additional capital injections with its internal cash resources, it added. Tata Sons Chairman N Chandrasekaran said the merger of Vistara and Air India is an important milestone in the journey to make Air India a truly world-class airline.

"As part of the transformation, Air India is focusing on growing both its network and fleet, revamping its customer proposition, enhancing safety, reliability and on-time performance. We are excited with the opportunity of creating a strong Air India which would offer both full-service and low-cost service across domestic and international routes," he said.

Four airlines are part of the Tata group. They are Air India, Air India Express, AirAsia India and Vistara. Tata Group acquired Air India and Air India Express in January this year.

Bizz Buzz
Next Story
Share it