Indian giant conglomerate Tata is buying back Air India, 89 years after founding it as Tata Air and half a century following its nationalisation, the government said Friday.
The $2.4-billion deal marks the end of a lengthy effort to privatise the heavily indebted flag carrier that has eaten up $14.7 billion in public money since 2009. Tata won over the SpiceJet consortium led by Ajay Singh.
The national carrier has been incurring losses ever since its merger with Indian Airlines in 2007. However, it took over two decades and as many as three attempts for Air India to finally change hands. The Tata deal includes 100% of the Air India Express subsidiary.
The airline was founded in 1932 with the first flight piloted by Tata’s eponymous chairman himself JRD Tata, flying mail and passengers in a single-propeller de Havilland Puss Moth from Karachi to Bombay via Ahmedabad.
The airline was nationalised in the 1950s.
“Welcome back, Air India,” Tata’s patriarch chairman emeritus Ratan Tata tweeted on Friday, while admitting it “would take considerable effort to rebuild” the company.
Welcome back, Air India 🛬🏠 pic.twitter.com/euIREDIzkV
— Ratan N. Tata (@RNTata2000) October 8, 2021
The airline at one time “gained the reputation of being one of the most prestigious airlines in the world. Tatas will have the opportunity of regaining the image and reputation it enjoyed in earlier years,” he said.
Tata Group, one of India’s biggest and oldest companies, employs over 800,000 people in 100 countries.
Buying back India’s biggest international airline – domestically IndiGo is number one – is part of ambitious plans. Tata owns 51 percent in Indian airline Vistara – Singapore Airlines holds the remaining 49 percent – as well as an 84-percent stake in AirAsia India, all of which Tata will now try to bring together.
Air India comes with a fleet of around 120 aircraft in addition to 4,400 domestic and 1,800 international landing and parking slots at domestic airports, and 900 slots at airports overseas.
Air India operates 50 percent of all international flights from India.
— Tata Group (@TataCompanies) October 8, 2021
Sources: Gulf News, The Times of India