Vistara To Merge With Tata Group-Owned Air India: Singapore Airlines

Singapore Airlines and Tata Group aim to complete the merger by March 2024, subject to regulatory approvals

SIA will also invest Rs 2,058.5 crore in Air India as part of the transaction and this would give SIA a 25.1 per cent stake in an enlarged Air India group with a significant presence in all key market segments.

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Singapore Airlines (SIA) on Tuesday said Vistara will be merged with Tata Group-owned Air India. The Indian conglomerate owns a 51 per cent stake in Vistara, while the remaining 49 per cent shareholding is with Singapore Airlines (SIA).

SIA will also invest Rs 2,058.5 crore in Air India as part of the transaction, as per an official release issued on Tuesday. This would give SIA a 25.1 per cent stake in an enlarged Air India group with a significant presence in all key market segments, it added. In a release, SIA said, “This would give SIA a 25.1 per cent stake in an enlarged Air India group with a significant presence in all key market segments. SIA and Tata aim to complete the merger by March 2024, subject to regulatory approvals.”

As reported by Bloomberg, the Tatas were considering a plan to integrate its four airline brands under Air India Ltd., as the conglomerate prepares to rebuild its faltering aviation empire.

Air India is fully geared up for revamps under the Tatas. The full-service carrier is considering ordering as many as 300 narrow-body jets, a transaction that would be one of the largest orders ever in commercial aviation history.

Its Chief Executive (CEO) Campbell Wilson last month said the airline will triple its fleet of 113 aircraft over five years, with a “significant” increase in both narrow and wide-body aircraft.

Air India is also in discussions to raise at least $1 billion in a funding round that could value the carrier at around $5 billion, other people familiar with the matter said in late September. The airline is planning to add 25 Airbus SE and five Boeing Co aircraft from lessors, starting in December.

Tata was selected as the winning bidder for Air India in October last year after beating rival suitors with a $2.4 billion offer.

The transaction marked India's most high-profile privatisation under Prime Minister Narendra Modi, ending decades of attempts to offload the money-losing, debt-laden carrier that survived on years of taxpayer bailouts.

It also meant Tata had four airline brands – Air India and another full-service carrier Vistara, along with budget carriers Air India Express Ltd, and AirAsia India.