In an effort to improve its standing in India and abroad, Tata Group, the parent company of Air India and the largest stakeholder of Vistara, declared its intention to merge the two airlines.
The strengthened Air India would seek to expand further in order to compete with Middle Eastern-based airlines.
Vistara would be purchased by Air India under this merger proposal. The latter would transfer its fleet and network to India’s de facto flag carrier.
The latter would transfer its fleet and network to India’s de facto flag carrier.
Tata would thereafter acquire 74.9% of Air India, and Singapore Airlines would own 25.1% of the expanded airline.
By October 31, 2024, the two businesses anticipate getting the go-ahead from a number of Indian regulatory authorities, including the Directorate General of Civil Aviation (DGCA), the Ministry of Civil Aviation, and others.
The agreement “shall terminate, and the Proposed Merger would not proceed” if the merger is not finished by then, according to a press release from Singapore Airlines (SIA1) (SINGY).
The Singapore Changi Airport (SIN)-the based airline will invest up to INR50.2 billion ($615 million) if the merger proceeds to further bolster Air India’s future. The final amount, according to the filing, is dependent “on various factors, including the progress of the business plans of the enlarged AI, and its access to other funding options.”