Singapore Airlines (SIA) will invest an additional ₹3,194 crore in Air India as it acquires a 25.1 per cent stake in Air India. SIA, which holds 49 per cent stake in Vistara, will receive the shares of Air India on the completion of merger of two Tata-group airlines on November 12.
Tata Sons and SIA had announced the merger of Vistara and Air India in November 2022 to drive synergies and gain share in the fast growing Indian market. The Competition Commission of India granted its clearance last September and the National Company Law Tribunal gave its nod to the merger in June.
While SIA is investing ₹2,058 crore for a 25.1 per cent stake in the merged entity, it also agreed to contribute its share of any funding previously provided by Tata Sons prior to the completion of the merger. This would enable the airline to maintain 25.1 per cent stake in the airline.
‘Significant presence’
SIA’s additional capital injection is expected to be ₹3,194 crore, based on Tata group’s funding to Air India to-date. “This will occur after the completion of the merger and within November 2024, through subscription to new Air India shares. Future capital injections will be considered based on Air India’s requirements and available funding options,” the airline said in a statement
“The merged entity will have a significant presence across all key Indian air travel segments including domestic, international, full-service and low-cost operations. This will strengthen SIA’s multi-hub strategy, allowing it to continue participating directly in India’s large and fast-growing aviation market,” it added.
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Published on November 10, 2024
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