Air India’s acquisition of Vistara has moved into its final stages after the Indian government approved an investment from Singapore Airlines into the new company.
Vistara confirmed that it would cease operations on 11 November as Air India begins absorbing its operations, fleet and staff after clearing the final hurdle for the acquisition.
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Singapore Airlines, which owns 49% of Vistara along with the Tata Group, will put around $250m into the new company in return for a stake of about 25.1% in the Air India Group, ensuring it remains the only foreign investor in an Indian airline.
The merger received the green light from Singaporean authorities in March but the wait for the Indian government’s foreign investment approval of Singapore Airlines’ role has pushed finalisation of the merger past an initial March 2024 deadline.
The filing detailing Sinagpore’s investment states the merger is now expected to be completed by the end of 2024 with talks ongoing to extend the previously agreed stop date of 31 October.
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By GlobalData
The end of the Vistara brand comes after a decade of operations for the airline and continues the Tata Group’s efforts to grow the Air India group following its acquisition of the flag carrier in 2022.
Already India’s largest conglomerate, Tata has been extending its dominance to the country’s rapidly growing aviation industry and has already added AirAsia India to the Air India group, while also investing tens of billions of dollars into the company’s fleet.
The company’s investments also continue the current acquisitions trend in the global aviation industry with Air France-KLM recently finalising an investment in SAS, while Korean Air continues to seek approval for its takeover of Asiana Airlines, and Alaska Air nears approval for its merger with Hawaiian Airlines.
