E-Paper
Tata Group regains Air India’s ownership after seven decades
The airline began its journey under the Tatas 90 years ago before the government nationalised the sector in 1953
NEW DELHI: The government on Thursday handed over Air India (AI) to the Tata Group, marking the end of the process for the transfer of the debt-laden national carrier.
The airline began its journey under the Tatas 90 years ago before the government nationalised the sector in 1953. Its 100% stake was sold to the autos-to-steel Tata conglomerate for ₹18,000 crore. The Centre announced the sale on October 8.
Talace Pvt Ltd, a wholly-owned subsidiary of Tata Sons, gets 100% equity shares of AI and AI Express. It will also get the government’s 50% stake in ground-handling company AISATS.
In a tweet, department of investment and public asset management secretary Tuhin Kanta Pandey said: “The strategic disinvestment transaction of Air India successfully concluded today with transfer of 100 per cent shares of Air India to M/s talace Pvt Ltd along with management control.” He added a new board, led by the strategic partner, has taken AI’s charge.
In a statement, the finance ministry said the strategic disinvestment transaction has been completed with the government receiving ₹ 2,700 crores.
Tata Sons chairman N Chandrasekaran said they are totally delighted that this process is complete. “We are very happy to have Air India back in the Tata fold. We look forward to working with everyone.”
In a tweet, civil aviation minister Jyotiraditya M Scindia said, “Best wishes to the new owners. I am confident that the airline will bloom under their wings, and pave the way for a thriving & robust civil aviation industry in India.”
An internal message sent to AI employees on Monday said the closing balance sheet was to be submitted by the end of the day. The balance sheet was then forwarded to the Tata Sons for review.
Officials were working round the clock to complete all procedures this week.
On October 8, the Tatas beat the ₹15,100-crore offer of a consortium SpiceJet promoter Ajay Singh led and the reserve price of ₹12,906 crore set for the sale of 100% stake in the carrier.
The bid amount includes about ₹15,300 crores of the carrier’s ₹61,562 crore debt. The remaining will be transferred to Air India Assets Holding Limited, a special purpose vehicle formed by the government.
On October 11, a Letter of Intent was issued to the Tata Group confirming the government’s willingness to sell its 100% stake in the airline. On October 25, the Centre signed the share purchase agreement for this deal.
The deal was a boost for the government’s disinvestment drive and financial books. In the last financial year, which was battered by the pandemic, the airline was estimated to have lost ₹27 crores daily.
For Tata Group, AI is the third airline. It holds a majority interest in AirAsia India and Vistara, a joint venture with Singapore Airlines. It will also get the AI’s prized landing and parking slots. AI has control of 4,400 domestic and 1,800 international landing and parking slots at domestic airports. It also has 900 slots at airports overseas such as London’s Heathrow and New York’s JFK.
