Tatas seek details of Air India disinvestment

The Tata group has informally sought details on the planned sale of Air India, a government official said, reflecting the group’s interest in the airline it founded in 1932.

Ratan Tata had in 2013 said Tata group would be interested in buying a stake in Air India if the government were to privatise the airline.
Ratan Tata had in 2013 said Tata group would be interested in buying a stake in Air India if the government were to privatise the airline.

The Tata group has informally sought details on the planned sale of Air India, a government official said, reflecting the group’s interest in the airline it founded in 1932.

“They have asked us how do you want to do it, what will you do with debt, what will happen to the subsidiaries,” the official said, asking not to be identified.

Senior Tata group executives posed the questions in informal discussions “at different levels” of the government after the cabinet approved the disinvestment on 28 June, the official said.

IndiGo, the largest airline in India owned by InterGlobe Aviation Pvt Ltd, has already gone public with its interest in Air India.

The Tata executives were told that their questions were in the realm of the group of ministers including Arun Jaitley, Nitin Gadkari, Suresh Prabhu, Piyush Goyal and Ashok Gajapathi Raju which is studying the sale of Air India, the official mentioned earlier said.

The ministers have been asked to look at hiving off certain Air India assets, a possible demerger, strategic disinvestment of three profit-making subsidiaries, quantum of disinvestment and eligible bidders.

“The meeting is scheduled to be held soon,” the official said.

Tatas declined comments.

“We do not comment on such matters,” Tata Sons spokesperson said.

Founded by J.R.D. Tata, Air India was born as Tata Airlines. Its name was changed to the current one in 1946. It was nationalised in 1953.

In 2000, the Tata group and Singapore Airlines expressed their interest to buy up to 40% in Air India. In 2013, after a meeting with the then aviation minister, Ratan Tata, who was then group chairman, said the Tata group would be interested in buying a stake in Air India if the government were to privatize the airline. This didn’t happen.

The Tata group and Singapore Airlines launched Vistara in 2015, which will start international flights next year.

“I don’t think the government will break Air India into two because then the domestic arm will not have any value left. The international business is the prized catch and I think they would like to have that,” an airline industry executive said.


According to a Tata group official who spoke on condition of anonymity, the group is 149 years old and owns brands like Jaguar Land Rover. “What would be a perfect addition to the group on its 150th anniversary?” he said.
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