The ailing national carrier Air India may soon be acquired by India’s largest conglomerate, Tata Group.
If sources are to be believed, N Chandrasekaran, TATA group chairman had an informal meeting with the civil aviation ministry Ashok Gajapathi and Union finance minister Arun Jaitley in Delhi.
If sources are to be believed, N Chandrasekaran, TATA group chairman had an informal meeting with the civil aviation ministry Ashok Gajapathi and Union finance minister Arun Jaitley in Delhi.
How will this acquisition pan out?
The acquisiton may take the form of a partial or full government divestment.
However, Tata is not especially keen on inking the deal, unless the government dismisses over 50,000 crore debt.
History of Air India
As a matter of fact, Tata was the original owner of Air India. If this deal is inked, the carrier company will return to its original owner.
JRD Tata, Tata founder ushered in the aviation industry into India with the brand name of “Tata Airlines” in 1932, fourteen years after which the name was rebranded as “Air India”, which was nationalised in 1953.
Subsequently, then Tata group chairman Ratan Tata expressed his intention of acquiring the airlines.
Tata’s current stake in Airlines industry
Tata Sons holds 40% in AirAsia India with Malaysian budget carrier AirAsia, while it owns 51% in the full-service Vistara which is in alliance with Singapore Airlines.
Why AirIndia?
The national carrier which also has Boeing 777s and 787s in its fleet makes it a lucrative deal for Tata. Air India also boasts of enviable spots at various airports across various international countries. John.F.Kennedy airport, Tokyo airport, among many others has provided a considerable spot at their airport.
How will Air India acquisition boost Tata’s aviation segment?
Vistara plans to venture into international flights next year. If Tata and the aviation ministry freeze down the deal of Air India acquisition, it will become highly beneficial for the company in entering the international segment, as Air India occupies atleast 17% of international traffic from India.
Tata, a brand which is known for bettering customer experience anywhere and everywhere is toying with the idea due to a multiplicity of reasons. The government, too is inclined towards inking the deal with Tata as the company can transform the ‘bottlenecks’ into ‘advantages’ for the aircraft.
Tata Group, with the assistance of Singapore Airlines’ shall gift a new look to Air India including cabin cleanliness, amenities, passengers’ perception, etc.
