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TATA Group wins bid to acquire Air India Airlines

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Ultimately the speculation became the reality. India’s largest MNC Tata Sons has acquired Air India. 

A few days ago, it was heard that the Tata group will buy the national airlines but later that speculation was dispelled by the Center. Finally, on Friday, the government announced that the Tata group had bought Air India for Rs 16,000 crore. 

The Tata Group will take over state-owned Air India, marking a successful end to the government’s bid to privatize the national carrier after having failed to sell a majority stake in it in 2018.


The salt-to-software conglomerate placed a winning bid of ₹ 18,000 crore re-acquire the airline more than half a century after it ceded control to the government. Apart from 100 per cent stake in Air India, Air India Express, the winning bid also includes a 50 per cent stake in ground-handling company Air India SATS Airport Services Private Limited (AISATS). 

Tata’s special purpose vehicle (SPV) Talace Pvt Limited emerged as the winning bidder, DIPAM Secretary Tuhin Kanta Pandey said. As on August 31, 2021, Air India has a total debt of ₹ 61,562 crore, out of that ₹ 15,300 crore will be taken over by the bidder, Mr Pandey stated. 

So, ₹ 46,262 crore will be transferred to Air India Assets Holding Limited (AIAHL), he added. AIAHL is a SPV formed by the government. 

Civil Aviation Secretary Rajiv Bansal said that the winning bidder will not retrench any employee for minimum period of one year and if retrenched after a year, they will have to be offered VRS (voluntary retirement scheme). 

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Social security benefits will be provided to all employees, he added. Meanwhile, Mr/Ratan Tata, Executive Chairman posted on Twitter, “Welcome back to Air India.” 

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Note that before independence, Tata Airlines was built in 1932 by Tata. Later in 1948 the name was changed to Air India. The center acquired the flight from Tata in 1953. Although JRD Tata served as the chairman of the company till 1986. A circle seems to have been completed as Tata re-owned Air India.

This national airline was in debt. At the moment, their debt in the market is 43 thousand crore rupees. The government had earlier announced that Air India would be 100 per cent liquidated. The 50 per cent stake will be sold to a take-off and landing company. Air India’s Mumbai and Delhi homes will also be sold. So far, Air India operates 4,400 domestic flights and 1,700 international flights.

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