December: Tata Sons have recently increased its stakes from 51% to 83.67% in AirAsia India till now. This major step was taken to consolidate the aviation business of the company. The Tata group bought 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. Also, the company still has a call option on the remaining percentage of 16.33 held by its partners in the airline. A source claimed that Tatas will exercise its right which will give a complete exit to the group owned by Tony Fernandes by 2021 mid.
“We have far too many companies in the Tata group and some level of consolidation is essential,” Chandrasekaran had told Tata Review, the in-house magazine of the group. “Since the start of the Covid-19 pandemic, aviation has been one of the hardest-hit industries. Airlines around the world have cancelled flights and grounded planes and AAI is no exception. Due to this, the directors expect further capital requirements for AAI. As India is a non-core market for AirAsia (being a non-ASEAN country), the company will continue to regularly reassess its business strategies and dispose of non-core investments to augment its liquidity,” the airline said.
The joint venture of Tatas and AirAsia group headed off as a low-cost airline service back in 2014. Other than AirAsia, Tatas also own 51% of stake of the full-service carrier Vistara. Also, the company is in the race to acquire the air carrier Air India.
Also read: Domestic air passenger count drops by 51% from November levels of 2019
