Mumbai: Tata Sons increased its stake in AirAsia India on Monday to become the only company in India to run two airlines.
To exercise higher control over AirAsia India, Tata Sons has acquired about 8 per cent stake from businessman Arun Bhatia’s Telestra Tradeplace, raising its equity in the low-cost carrier from 41.06 per cent, to 49 per cent. Tata Sons’ two directors additionally acquired a cumulative 2 per cent, taking the combined stake of the Tatas and its directors in AirAsia India to 51 percent. S Ramadorai (Chairman) and R Venkataramanan acquired 0.5 per cent and 1.5 per cent, respectively.
Tata Sons already owns a majority stake in full-fare carrier Vistara, a joint venture with Singapore Airlines. Financial details were not disclosed, but the deal with Telestra signals Bhatia’s exit from the airline venture.
FDI rules allow foreign airlines to own up to 49 per cent in airlines, but management control must be with the local partner.
Until now Malaysia’s AirAsia, with a 49 percent stake, was the largest shareholder, raising doubts over management control. Tata Sons’ move to increase its stake may finally put to rest these doubts.
28/03/16 Business Line
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To exercise higher control over AirAsia India, Tata Sons has acquired about 8 per cent stake from businessman Arun Bhatia’s Telestra Tradeplace, raising its equity in the low-cost carrier from 41.06 per cent, to 49 per cent. Tata Sons’ two directors additionally acquired a cumulative 2 per cent, taking the combined stake of the Tatas and its directors in AirAsia India to 51 percent. S Ramadorai (Chairman) and R Venkataramanan acquired 0.5 per cent and 1.5 per cent, respectively.
Tata Sons already owns a majority stake in full-fare carrier Vistara, a joint venture with Singapore Airlines. Financial details were not disclosed, but the deal with Telestra signals Bhatia’s exit from the airline venture.
FDI rules allow foreign airlines to own up to 49 per cent in airlines, but management control must be with the local partner.
Until now Malaysia’s AirAsia, with a 49 percent stake, was the largest shareholder, raising doubts over management control. Tata Sons’ move to increase its stake may finally put to rest these doubts.
28/03/16 Business Line
