The Tata Group’s plans to consolidate its aviation business got a major thrust on Tuesday as the Competition Commission of India (CCI) approved the acquisition of AirAsia India by Air India.
Tata’s aviation business includes – Vistara, a joint venture between Tata and Singapore Airlines, AirAsia India, which was a joint venture between Tata and Malaysia-based AirAsia Group and Air India, which along with Air India Express, Tata Sons had fully acquired from the government last year.
On Tuesday, the competition regulator cleared the proposal of Air India to acquire AirAsia India.
“The proposed combination envisages the acquisition of the entire equity share capital of AirAsia (India) Private Limited by Air India Limited, an indirect wholly owned subsidiary of TSPL,” CCI said in a brief statement.
Currently, Tata Sons holds 83.67 per cent stake in AirAsia India, while the rest is held by AirAsia Investment Limited.
It was in 2014 that AirAsia India started operations. It only flew to domestic destinations. Both Air India and Vistara fly domestic as well as to international destinations. Air India Express is essentially a budget carrier linking west and south India to the Gulf and south east Asian countries.
Tuesday’s CCI clearance means Malaysia’s AirAsia Group will soon be exiting India.
Reports have suggested that Air India will acquire AirAsia’s 16.3 per cent stake for Rs 139 crore. It will also acquire the 83.67 per cent stake that Tata Sons holds in AirAsia India.
Tata Sons had acquired state-owned Air India for Rs 18,000 crore last year. The airline was handed over by the government to the Tatas on January 27, 2022.
