Air India Goes Back To Tata Sons After 68 Years

India’s national carrier Air India goes back to Tatas which founded the airline in 1932.

Tata Sons has emerged as the successful bidder for the national carrier.

It placed a bid of Rs.18,000 crore to re-acquire the Air India which was founded by Jehangir Ratanji Dadabhoy (JRD) Tata, the former chairman of Tata group. It was Tata Airlines then.

In 1946, the aviation division of Tata Sons was listed as Air India and in 1948, Air India International was launched with flights to Europe.

In 1948, 49% of the airline was acquired by the Government of India and in 1953, the Government of India passed the Air Corporations Act and purchased a majority stake in the carrier from Tata Sons. Tata was keeping 25 per cent and the public was owning the rest.

In 1953, Air India was nationalized.

According to PTI, salt-to-software conglomerate Tatas have won the bid to acquire debt-laden state-run Air India offering Rs.18,000 crore for acquiring 100% shareholding, a senior government official said on Friday.

An SPV of Tata Sons — the holding company of conglomerate — has emerged as successful bidder, Tuhin Kanta Pandey, secretary to the Department of Investment and Public Asset Management (DIPAM) — the government department responsible for privatization – said.

Tata Sons beat SpiceJet promoter to bag Air India.

The DIPAM secretary said Tatas’ bid of Rs. 18,000 crore comprises taking over of Rs.15,300 crore of debt and paying the rest in cash, the PTI report said.

Both bidders had quoted above the reserve price, he said adding the transaction is planned to be closed by December.

He said a group of ministers comprising Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, Commerce Minister Piyush Goyal and Civil Aviation Minister Jyotiraditya Scindia has cleared the winning bid for Air India on October 4.

This marks the return of Air India to the Tatas.

The government is selling 100 per cent of its stake in the state-owned national airline, including Air India’s 100 per cent shareholding in AI Express Ltd and 50 per cent in Air India SATS Airport Services Private Ltd.