Tata Sons takes over Air India
On October 8, the salt-to-software conglomerate had won the bid to acquire the debt-ridden national airline for Rs 18,000 crore.
The Centre on Thursday handed over the debt-ridden Air India to Tata Sons. On October 8, the salt-to-software conglomerate had won the bid to acquire the airline for Rs 18,000 crore.
In a statement released on Thursday, the Ministry of Finance said that strategic disinvestment of the airline was complete and the government had received Rs 2,700 from Talace Private Limited, a subsidiary of Tata Sons.
A debt of Rs 15,300 in Air India and Air India Express, 100% shares of the two entities and 50% shares of the airport service provider Air India SATS have been transferred to the Tata Group, according to the ministry.
“We are totally delighted that this process is complete and happy to have Air India back in the Tata Group,” the conglomerate’s Chairman N Chandrasekharan told reporters. “We look forward to walking with everyone to create a world-class airline.
Chandrasekharan met Prime Minister Narendra Modi earlier on Thursday.
Tuhin K Pandey, secretary of the Department of Investment and Public Asset Management, said that all the formalities of the deal were completed and the Air India disinvestment transaction was closed, The Hindu reported.
Following Thursday’s takeover, Tata Sons regained control of Air India nearly 70 years after its nationalisation. Air India was founded in 1932 as Tata Airlines by family scion and aviation enthusiast Jehangir Ratanji Dadabhoy Tata.
In a press release, Tata Sons said that it would take over the management and control of Air India from Thursday.
“We philosophically agree with the prime minister’s vision for the aviation sector of making it affordable and ensuring contribution to boosting ‘ease of living’ for citizens,” the release stated.
On Thursday, a circular was shared with all Air India pilots to announce Tata Son’s take over of the national carrier as part of the welcome announcements in all departing flights, ANI reported.
However, as part of the deal, Tata Sons will not get possession of Air India’s non-core assets such as the Vasant Vihar Housing colony and Air India buildings in Mumbai and New Delhi, NDTV reported.
The deal was expected to close by December 2021 but was extended till January due to a delay in procedural work, according to PTI.
The first-ever attempt at disinvesting the airline was taken in 2001 during the Atal Bihari Vajpayee-led NDA government. After initial interest from foreign airlines, the deal had failed after the government announced that foreign airlines will have to partner with an Indian company in order to bid, according to The Indian Express.
In 2018, the Narendra Modi government had planned to divest 76% stake in Air India, ignoring a parliamentary panel’s recommendation to give the debt-ridden airline five years to revive itself. The proposed stake sale, however, failed to take off as the government did not receive any expressions of interest from potential bidders by the end of the deadline.