Singapore Airlines in Talks With Tata Group on Vistara & Air India Merger

A Vistara Airbus landing at Bengaluru
Venkat Mangudi, CC BY 2.0, via Wikimedia Commons

LONDON – It has been reported that Singapore Airlines are currently in discussions with India’s Tata group with regards to the continuing matter of a possible merger between airlines Vistara and Air India.

Last month AviationSource reported on discussions regarding the possible merger of the two Tata group airlines, Vistara and Air India.

Speaking in September with respect to the prospect of a merger, the Vistara CEO Vinod Kannan had commented: “All possibilities are being discussed. Since we are a joint venture, the two shareholders will have to discuss a road-map for the future. Whether it’s going to be a merger, or we will have two separate airlines are all options that are still on the table.”

At that time, Singapore Airlines, the other major stakeholder in Vistara, had made no formal comments with respect to the potential of a merger. The Vistara CEO had however intimated that discussions had begun and that clarity would be gained in coming months.

The Singapore airline had requested time until the end of 2023 to consider all the financial aspects of a merger between the two Tata group stable mates.

About Vistara

Vistara is a joint venture of Tata Sons Private Limited and Singapore Airlines Limited (SIA) – Tata Sons currently holds 51% stake in partnership and Singapore Airlines owns 49% stake. The company is registered as TATA SIA Airlines Limited.

In 2013, the two key stakeholders Tata Sons and Singapore Airlines had decided to fulfil a long-cherished shared dream to bring forth a distinguished flying experience to air travellers in India.

With its strong historical ties with aviation, the Tata group had long wished to re-enter the aviation sector, after Tata Airlines was renamed Air India and eventually, nationalised.

Both the Tata group and Singapore Airlines were also firm believers in the growth potential of the Indian aviation sector and hence tried to enter the market in the past; first, in 1994 by setting up a joint venture to start an airline in India and then in 2000, teaming up to purchase stakes in Air India.

However, after the lifting of foreign investment restrictions in 2012, the partners once again sought approval for a tie-up, which it obtained in October 2013. On November 5, 2013, Vistara’s holding company, TATA SIA Airlines Limited, was incorporated.

On January 9, 2015, Vistara started its operations with a maiden flight from Delhi to Mumbai. In a short span of time, Vistara has rapidly expanded its footprint, both in terms of network and service proposition.

Vistara connects 39 destinations in and outside of India, operates over 220 flights a day with a fleet of 50 aircraft including 39 Airbus A320, 5 Boeing 737-800NG, 4 Airbus A321neo and 2 Boeing B787-9 Dreamliners. 

Vistara management

Vistara’s parentage is reflected in the company’s management with expertise drawn from both stakeholders, Singapore Airlines and Tata Sons.

The joint venture has a five-member Board, comprising its Chairman, Mr. Bhaskar Bhat, Ex-MD of Titan Company Ltd, Director-on-Board, Mr. Lee Lik Hsin, Executive VP (Commercial) Singapore Airlines and independent Directors Mr. Som Mittal, former President & Chairman Nasscom, Ms. Sangeeta Pendurkar, CEO, Pantaloons (Aditya Birla Group) and Mr. S. Padmanabhan, Executive Chairman – Tata Business Excellence Group & Group Chief Ethics Officer, Tata Sons.

Currently, both of the Tata Group stable mates Air India and Vistara operate in competition on several routes and networks.

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