AirAsia India merges with Air India

The Tatas have announced the merger of Air India (AI) with AirAsia India Pvt ltd (AAIPL) and will bring these two under one umbrella at a colossal office in Gurgaon. The Competition Commission of India (CCI) was informed by Air India about the merger. AAIPL, which has started operations in the year 2014, does not hold the rights to fly abroad.
The notification to CCI reads; “An indirect wholly owned subsidiary of Tata Sons Private Limited (TSPL), Air India, acquires the entire equity share capital of AAIPL and currently 83.67% of the equity share capital of AAIPL, is owned by TSPL. The remaining 16.33 % stake at AAIPL will be owned by AirAsia. The suggested merger is reported under the Competition Act, 2002”. It further adds: “The suggested amalgamation is not going to have an effect on the competitive situation or cast an unfavourable influence on the competition in India.”
In addition, the Tata Group has begun to move all four airlines to a single mega headquarters in Gurgaon, a suburb of Delhi, in order to improve synergy. It has allocated office space that can be rented “immediately” and spans up to 70,000 square feet. The company is now finalising its office requirements with Tata Realty and aims to begin the shift as soon as possible.
In order to optimise resources, promote teamwork, and increase synergies at work, the various entities would relocate together into a complex in Gurgaon in phases. “We have discovered a new office location on NH8 where we have the opportunity to lease up to 700,000 sq ft immediately,” according to a statement issued to the leaders of these five Tata aviation firms.
“We must now determine our specific space requirements and promptly begin preparing the shift to this new location. We plan to relocate in the next two to three months. The duty of developing the strategic plan has been assigned to Harpreet A De Singh, ED headquarters, as well as Ernst & Young consultants,” the statement continues.
The businesses have been urged to provide this team with information regarding their required office space “as soon as possible,” in order to “enable this strategic change and consolidation.” Gurgaon already is home to IndiGo and SpiceJet, so this move will solidify the city’s position as India’s aviation capital. Mumbai, once a major airline hub, currently has only a few large airlines, such as GoAir.
AI and AI Express were purchased by the Tata Group in late January. It is still unclear how the four airlines will be merged, with the options being: a low-cost airline formed by merging AI Express and AirAsia India, AI and Vistara; one full-service and a low-cost airline formed by merging AI Express and AirAsia India, AI and Vistara; and AI (merging all three) and Vistaara until the latter’s 49 percent stakeholder, Singapore Airlines, agrees to a merger with AI. To finalise the future course of action, the company is looking for a CEO for its airline division