Tata Group and Singapore Airlines (SIA1) (SINGY) could soon merge their airline businesses under a new joint venture between Air India and Vistara, sources close to the matter told Live Mint on September 27, 2022.
Singapore Airlines (SIA1) (SINGY), the parent company of Indian full-service air carrier Vistara, could own a 25% stake worth between $61.4 million and $1.2 billion (INR 5,000 – 10,000 crore) in the new joint venture, the industry sources confirmed.
“SIA [Singapore Airlines (SIA1) (SINGY), ed.-] is Tata Sons’ current joint venture partner in Vistara. Talks are going on between the two joint venture partners on how best to leverage the future India opportunity in aviation. What corporate structure will emerge is still under discussion,” the sources claimed.
After the merger, which may take up to a year to complete, Air India and Vistara are expected to keep their brand identities, but one brand could eventually dominate.
The deal is expected to help Tata Group, Air India’s new owner, to consolidate its aviation business balance sheets and optimize both its route network and aircraft fleet. The merger could also strengthen Air India’s market share in India, making it a stronger competitor for the low-cost carrier IndiGo, which currently holds 59% of the local market.