India’s anti-trust regulator, the Competition Commission of India (CCI), has approved the acquisition of the entire stake-holding in AirAsia by Air India. This move reportedly paves way for the consolidation among the Tata Group airlines.
Air India flagship
The acquisition will see Air India – the airlines which the Tata Group took over in January – emerge as the flagship with the two low cost carriers, AirAsia and AI Express, merging with the former. Air Vistara, a Tata–Singapore Airlines joint venture, will currently be operating as a separate carrier.
“The proposed combination envisages the acquisition of the entire equity share capital of AirAsia (India) (AirAsia India) by Air India , an indirect wholly-owned subsidiary of Tata Sons (TSPL),” the CCI statement said.
Air Asia India, which started flying in June 2014, offers scheduled air passenger transport, air cargo transport and charter flight services in the country. Air Asia India is a joint venture between TSPL and Air India Investment Limited (AAIL) with TSPL presently holding 83.67 per cent and AAIL holding 16.33 per cent of the shareholding. In December 2020, the Tatas had raised their stake in the airlines
Air Asia India operates under the brand name “AirAsia”.
The combined entities have a near 16 per cent market share in India’s domestic passenger market – thereby making them the second largest in India.
Air India Express, operates between India and Gulf routes; and does not have domestic air operations.
IndiGo continues to be the country’s largest airlines with around 54 per cent market share.