29th November, TATA has announced that they will Merge recently took overed National carrier Air India Limited with its Premium JV Vistara airlines.
The announcement is not a surprise as they have been discussing merger since Air India Takeover in early 2022. Today they officially stated about the merger plans through a Press release.
TATA and SIA to merge Air India with Vistara
TATA Vistara’s JV Company Singapore International Airlines (SIA) board on Tuesday Approved the Air India and Vistara Merger plans by the year 2024.
The SIA stated in its statement that it will hold 25.1% stake in the newly formed Air India which will then make a Trio, Air India, Air India Express and Vistara. According to some Source the TATA is also looking to Merge Air India Express with Air Asia India and that might be inducted into Newly formed Air India.
To successfully complete this Transaction the TATA Sons will invest 360 million USD while SIA will 250 million USD which accounts for 2050 Crore Indian Rupees. SIA is also committed to Invest its 175 million USD cash as of 30th September 2022.
The 250 million US dollars fund will provide 25.1 stake to SIA, and they are well committed to invest any fund up to 580 million USD post the merger to help in the growth of entity.
The Investment will increase the stronghold of Singapore Airlines in Indian Aviation Market. The partnership will also boost SIA’s share 4-5 times, compared to Vistara in new Air India.
The announcement came when we are Remembering the most inspiring J.R.D TATA on his 29th Death Anniversary. He will be happy to see its airlines becoming greater and better again under TATA’s leadership.
Statement by Officials
The Chief Executive Officer (CEO) of Singapore Airlines, Mr. Goh Choon Phong Said,
“Tata Sons is one of the most established and respected names in India. Our collaboration to set up Vistara in 2013 resulted in a market-leading full-service carrier, which has won many global accolades in a short time.”
Mr. Goh Choon Phong, Chief Executive Officer, Singapore Airlines
He Further Added,
“With this merger, we have an opportunity to deepen our relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market. We will work together to support Air India’s transformation programme (Vihaan), unlock its significant potential, and restore it to its position as a leading airline on the global stage.”
Mr. Goh Choon Phong, Chief Executive Officer, Singapore Airlines
While TATA Sons Chairman, Mr. Natarajan Chandrasekaran said,
“The merger of Vistara and Air India is an important milestone in our journey to make Air India a truly world-class airline. We are transforming Air India, with the aim of providing great customer experience, every time, for every customer. As part of the transformation, Air India is focusing on growing both its network and fleet, revamping its customer proposition, enhancing safety, reliability, and on-time performance.”
Mr. Natarajan Chandrasekaran, Chairman, Tata Sons
He further stated,
“We are excited with the opportunity of creating a strong Air India which would offer both full-service and low-cost services across domestic and international routes. We would like to thank Singapore Airlines for their continued partnership.”
Mr. Natarajan Chandrasekaran, Chairman, Tata Sons
Today, Singapore Airlines and Tata sons hold a 49% and 51% stake in Premium Airline Vistara respectively. Tata sons wholly owns Air India, which includes the low-cost carriers Air India Express and AirAsia India.
To put cherry on Cake with this merger the TATA will have monopoly in Long international routes and will be only airline in India with Widebody fleets.
But the Indian civil aviation ministry has recently allowed the airlines to wet lease widebody planes like B777 to fly to long haul international routes such as North America and Europe to cater the demand and create a sustainable environment in market.
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