Air India sale: Tata Group looking at bid to fly the bird it founded 87 years ago back home

The Tata Group, which founded Air India 87 years ago and was then forced to relinquish control, said it will look at bidding for the airline put up for sale by the government.

“I will ask the team to evaluate it,” Tata Sons Chairman N Chandrasekaran told TOI in the course of an interview about his plans for the group as well as his recently-released book, Bridgital Nation. “Ideally it should be a Vistara decision, not a Tata Sons decision,” Chandrasekaran said before adding, “I’m not going to run a third airline (in addition to Vistara and AirAsia). Unless we merge. There are issues. I will never say yes or no. I don’t know.”

The government has in recent months indicated its willingness to exit Air India completely, as opposed to its earlier plan of retaining a minority 24%. It drew a blank in its earlier attempt last year to disinvest 76% in AI; the Tatas didn’t show any interest because the terms were onerous, besides which the conglomerate was evaluating the purchase of Jet Airways

Acquisition of Air India would help the Tatas scale their aviation business. The group has two joint ventures—one a full-service airline with Singapore Airlines (SIA) to operate Vistara, and a second with budget carrier AirAsia. Combined, they made a loss of over Rs 1,500 crore in fiscal 2019.

There is a sense that unlike Jet Airways, Ratan Tata, chairman emeritus of Tata Sons and head of Tata Trusts, might be favourably disposed towards the acquisition of Air India, which his predecessor JRD Tata founded in 1932. Air India would help Vistara grow internationally. Currently, Vistara flies to just four international destinations. Air India would also augment Vistara’s domestic market share, which presently stands at 6%, with its 12% presence.
If it acquires Air India, it will be 66 years after its nationalisation.

History will come full circle with the move, underlining not only the sorry fate of government-owned enterprises but also how India’s indigenous business groups refused to fade out even after decades of socialist policies.

Tata Sons set up Tata Airlines in 1932. JRD Tata, the legendary entrepreneur, himself flew the first flight between Karachi and Bombay. In 1946, Tata Airlines became a public company and was renamed Air India.

Tata Sons set up Tata Airlines in 1932. JRD Tata, the legendary entrepreneur, himself flew the first flight between Karachi and Bombay. In 1946, Tata Airlines became a public company and was renamed Air India.
04/11/19 Economic Times

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Source: economictimes.indiatimes.com

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