Tata Group Moves Ahead With Consolidating 4 Airlines Under It

Tata Group has completed the merger of Air India and Vistara, moving a further step toward the merger of airline businesses. The merger has reportedly been agreed upon by Vistara's joint owners, the Tata Group and Singapore Airlines (SIA). The merged business may have a Tata's stake of approximately 75%, with SIA controlling the remaining 25%. Tatas and SIA currently own 51% and 49% of Vistara, respectively. After acquiring all required approvals, the proposed merger is likely to be announced soon and finalised within a year.

Through the merger, the Tata Group intends to transform Air India into an umbrella carrier. With a full-service arm formed by combining Vistara and the Maharaja and a low-cost arm developed by combining AirAsia India (AAIPL) and AI Express, the Tata Group wants AI to serve as the umbrella provider. This is a component of the Tata group's strategy to merge all four airlines into Air India.

Currently, the Tata Group runs four airlines: Air India, Air India Express, Vistara, and Air Asia India. They include full-service operators Air India and Vistara as well as low-cost carriers AirAsia India and AI Express.

After buying the 16.3% share of AirAsia Aviation Group in AirAsia India, the group has already begun the merger of Air Asia India with Air India Express. Tata Sons now own 100% of AirAsia India after the Rs 155.6 crore deal was finalised earlier this month. The merger of AirAsia India and AI Express is now underway and is anticipated to be finished in 12 months.

With the systems of AI Express being transferred to AirAsia India's system, the company has begun working on the integration of information technology and passenger booking systems. The proposed acquisition of AirAsia India's complete stake by Air India has already received approval from the Competition Commission of India.