Tata Group, SIA to merge Vistara with Air India
Singapore Airlines to invest Rs 2,059 crore ($257 million) in Air India, hold 25.1% stake in Air India
The Tata Group today announced the consolidation of its airlines Vistara and Air India.
"With this consolidation, Air India shall be India'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," says a release from Tata Group.
Air India, an airline fully owned by Tata Sons, has been the flag carrier of India. Tata Sons, via its fully owned subsidiary Talace Private (Talace), had acquired 100 percent stake in Air India on January 27, 2022.
Vistara, a 51:49 joint venture between Tata Sons and Singapore Airlines (SIA), was established in 2012, and shall be merged with Air India after requisite approvals. As part of the merger transaction, SIA will invest Rs 2,059 crore ($257 million) in Air India and will hold a 25.1 percent equity stake.
"The merger of Vistara and Air India is an important milestone in our journey to make Air India a truly world-class airline," says N Chandrasekaran, Chairman, Tata Sons. "We are transforming Air India with the aim of providing great customer experience, every time, for every customer. 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. We would like to thank Singapore Airlines for their continued partnership."
Goh Choon Phong, Chief Executive Officer, Singapore Airlines, adds: "Tata Sons is one of the most established and respected names in India. Our collaboration to set up Vistara in 2013 resulted in a market-leading full-service carrier, which has won many global accolades in a short time. With this merger, we have an opportunity to deepen our relationship with Tata and participate directly in an exciting new growth phase in India's aviation market. We will work together to support Air India's transformation program, unlock its significant potential, and restore it to its position as a leading airline on the global stage."
The transaction is likely to be completed by March 2024, the release added.