Thursday, January 27, 2022

"Delighted It's Back": Tata Group Takes Over Air India After 69 Years

New Delhi: Tata group has officially taken over Air India from the government on Thursday. "We are totally delighted to have Air India back at the Tata group and are committed to making this a world-class airline," Tata Sons Chairman N Chandrasekaran said. Mr Chandrasekaran also met Prime Minister Narendra Modi ahead of the official handover. "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. A new Board, led by the Strategic Partner, takes charge of Air India," Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey stated.

Here's Your 10-Point Cheatsheet To This Big Story:

In October last year, the government had sold Air India to Talace Private Limited -- a subsidiary of the Tata group's holding company -- for ₹ 18,000 crore.

After that, a Letter of Intent (LoI) was issued to the Tata group confirming the government's willingness to sell its 100 per cent stake in the airline. Then, the Centre had signed the share purchase agreement (SPA) for this deal.

As a part of the deal, the Tata group will also be handed over Air India Express and a 50 per cent stake in ground handling arm Air India SATS.

Tatas had beaten the ₹ 15,100-crore offer by a consortium led by SpiceJet promoter Ajay Singh and the reserve price of ₹ 12,906 crore set by the government for the sale of its 100 per cent stake in the loss-making carrier.

While this will be the first privatisation since 2003-04, Air India will be the third airline brand in the Tata Group's stable -- it holds a majority interest in AirAsia India and Vistara, a joint venture with Singapore Airlines Ltd.

Tatas would not get to retain non-core assets such as the Vasant Vihar Housing colony of Air India, Air India Building at Nariman Point, Mumbai, and Air India Building in New Delhi.

At present, Air India controls over 4,400 domestic and 1,800 international landing and parking slots at domestic airports as well as 900 slots abroad.

Of the airline's 141 aircraft that Tatas would get, 42 are leased planes while the remaining 99 are owned.

Over the last decade, more than ₹ 1.10 lakh crore was infused by way of cash support and loan guarantees in the loss-making airline to keep it afloat. Currently, Air India is suffering losses of around ₹ 20 crore per day.

Tatas had set up Tata Airlines in 1932, which was later -- in 1946 -- renamed as Air India. The government had taken control of the airline in 1953, but JRD Tata continued to be its chairman till 1977. The handover will be the homecoming of Air India to Tatas after 69 years.

27/01/22 Sunil Prabhu, Vishnu Som/NDTV

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