Tata Sons has won the bid to acquire national carrier Air India. The salt-to-software conglomerate placed a winning bid of INR 18,000 crore re-acquire the airline more than half a century after it ceded control to the government.
Apart from 100 per cent stake in Air India and its low-cost arm, Air India Express, the winning bid also includes a 50 per cent stake in ground-handling company Air India SATS Airport Services Private Limited (AISATS). Tata’s special purpose vehicle (SPV) Talace Pvt Limited emerged as the winning bidder, said DIPAM Secretary Tuhin Kanta Pandey.
As on August 31, 2021, Air India has a total debt of INR 61,562 crore, out of that INR 15,300 crore will be taken over by the bidder, stated DIPAM secretary. So, INR 46,262 crore will be transferred to Air India Assets Holding Limited (AIAHL), he added. AIAHL is a SPV formed by the government.
Civil Aviation Secretary Rajiv Bansal said that the winning bidder will not retrench any employee for minimum period of one year and if retrenched after a year, they will have to be offered VRS (voluntary retirement scheme). Gratuity and Provident Fund (PF) benefits will be provided to all employees, he added.
Bansal also mentioned, “As of today, there are 12,085 employees in Air India out of which 8,084 are permanent and 4,001 are contractual. Besides this, Air India Express has a employee strength of 1,434.”
Despite its precarious finances, Air India still controls more than 4,400 domestic and 1,800 international landing and parking slots at domestic airports, and 900 slots overseas.
Air India began life as Tata Air Services in 1932 when it was founded by JRD Tata. The company was nationalised by the government in 1953. JRD Tata continued to be its chairman till 1977.
