AviationInvestment in Indian flag carrier and Air India-Vistara merger agreement will reshape aviation landscape in the subcontinent.

Merger in the skies: Singapore Airlines boosts strength in India

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Vistara is to be merged with Air India.
Vistara is to be merged with Air India. Photo Credit: Adobe/Ryan

Singapore Airlines has boosted its presence in India with a US$250 million investment in Air India, alongside an agreement between SIA and Tata Sons to merge Air India and full service carrier, Vistara.

This would give SIA a 25.1% stake in an enlarged Air India group. The merger is timed to finalise in March 2024.

SIA has also flagged an intention to invest a further US$615 million in Air India, subject to AI performance and other conditions.

SIA and Tata set up Vistara in 2013, with the merger set to increase SIA’s presence in India and strengthen its multi-hub strategy.

Following its acquisition by Tata in January 2022, Air India unveiled a wide-ranging transformation programme to strengthen its foundations and revamp its operations.

Goh Choon Phong, CEO, Singapore Airlines, said: “We have an opportunity to deepen our relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market.

“We will work together to support Air India’s transformation programme, unlock its significant potential, and restore it to its position as a leading airline on the global stage.”

Air India CEO and managing director Campbell Wilson recently told The Times of India that the airline is being rebuilt in three phases – taxiing, take-off and climb.

In the first “taxiing” phase, Air India wants to change “all the things that tarnish or continue to tarnish the brand”.

The second “take off” phase will see accelerated investment in systems, processes, people and equipment, including aircraft, “that will be necessary to bring Air India to the heights we aspire for it”.

“By the end of year five (third phase) we hope to go from very good by then to ultimately world class,” Wilson said, adding: “All of us right from the board and through the organisation realise this is once in a lifetime opportunity to build an AI that represents India in a way that India deserves to be represented around the world.”

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