TATAs to Take ‘Air India’ Home on January 27

On January 27, the central government will hand over Air India to the Tata group. The deadline for closing the deal was extended until the end of January due to delays in finalizing the airline’s balance sheet and obtaining the necessary approvals from global regulators. The transfer will bring the disinvestment process to an end months after the sale was finalized.

The Tata group has already received Air India’s closing balance sheet as of January 20 for review, and any changes must be made by Wednesday. Following the procedure, the airline’s transfer would be completed shortly after Republic Day.

During the transfer, officials from the Department of Investment and Public Asset Management (DIPAM) and the Finance Ministry, as well as top Tata Group executives, will be present, and Air India will formally become the Maharaja of Tata. Last October, the government sold Air India for Rs 18,000 crore to Talace Private Limited, a subsidiary of the Tata group’s holding company. According to a PTI report, officials said on Monday that the remaining formalities in this deal will be completed in the coming days, and the airline will be handed over to the Tata group by the end of this week.

After a competitive bidding process, the Tata group purchased Air India from the government on October 8, 2021 for Rs 18,000 crore. On October 11, the government issued a letter of intent (LoI) to the Tata Group, confirming the government’s willingness to sell its entire stake in the airline. Tatas will buy the airline for Rs 2,700 crore in cash up front. Aside from the upfront payment, the Rs 18,000-crore deal requires the new owner to assume Air India’s Rs 15,300-crore debt, unless the former and current owners are the same.

Top politicians and experts hailed the confirmation of Air India’s sale to Tata as a major milestone. Many experts believe that the sale will allow the loss-making airline to correct its course.

It should be noted that Tata Sons will transfer 100% of Air India to Talace Private Limited, which is a wholly-owned subsidiary of Tata Sons. The Tatas already own a majority stake in AirAsia India and Vistara, a joint venture with Singapore Airlines Ltd, so Air India will be their third airline brand.

The transfer of Air India from the government to the Tata group is unlikely to have a significant impact on operations, at least in the short term. While there may be some minor adjustments, no major changes are expected for at least a few months. Changes in personnel or flight operations are examples of this.

Customers are unlikely to be impacted by the transition because flying operations will remain unchanged. The only changes that passengers are likely to notice are branding on the inside and outside of the aircraft.

The transfer of Air India from the government to the Tata group is unlikely to have a significant impact on operations, at least in the short term. While there may be some minor adjustments, no major changes are expected for at least a few months. Changes in personnel or flight operations are examples of this.

Customers are unlikely to be impacted by the transition because flying operations will remain unchanged. The only changes that passengers are likely to notice are branding on the inside and outside of the aircraft. However, the Tatas’ decision to operate the airline may change in the long run. According to previous reports, the Tata group is looking to consolidate all of its airline operations into a single unit.