Categories: Economy

Tata Group hikes stake in AirAsia India

The Tata Group has increased its stake in AirAsia India to 83.67 per cent from 51 per cent earlier as part of a move to consolidate its aviation business at a time when the group is bidding for Air India.

Tata Sons, the holding company of the group, has bought a 32.67 per cent stake from AirAsia Berhad at Rs 276.29 crore, the Malaysian airline told the Kuala Lumpur-based exchange Bursa on Tuesday. It also has a call option on the remaining 16.33 per cent stake that its partner holds in the airline. A person aware of the development said Tatas would exercise the right, thereby giving a total exit to the Tony Fernandes-owned group by the middle of 2021.

The 51-49 joint venture partnership between the Tatas and the AirAsia group had started operations in 2014 as a low-cost carrier in the country.

Beside AirAsia India, Tatas own 51 per cent stake in full service carrier Vistara which is a JV with Singapore Airlines.

AirAsia group cited disruption caused by Covid-19 pandemic as a reason for planning to quit the JV. Calling India a non-core market, it said the proceeds from the sale would be used to re-organise its business in Malaysia..

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