Air India has proposed to acquire a 100 percent equity of AirAsia (India) Private Limited. Air India proposed in a petition moved before the Competition Commission of India (CCI).
Both aviation businesses provide domestic scheduled air transport services, air cargo transport services, and charter flight services in India. Air India also operates commercial international flights.
In its note to the CCI, Air India has said “the proposed combination will not lead to any change in the competitive landscape or cause any appreciable adverse effect on competition in India, irrespective of the manner in which the relevant markets are defined.”
The latest move is likely a part of the sprawling group’s efforts to consolidate its airline operations. “The proposed combination relates to the acquisition of the entire equity share capital of AirAsia (India) Private Limited (Air Asia India/ Target), by Air India Ltd (AIL), an indirect wholly-owned subsidiary of Tata Sons Private Limited,” a notice filed with the Competition Commission of India (CCI) said. Deals beyond a certain threshold require the approval of CCI, which works to foster competition as well as curb anti-competitive practices in the marketplace.
AirAsia India is majority-owned by Tata Sons Private Ltd with a shareholding of 83.67 per cent and the remaining stake is with AirAsia Investment Ltd (AAIL), which is part of Malaysia’s AirAsia Group.
Full-service carrier Air India and its low-cost subsidiary Air India Express were acquired by Talace Private Limited, a wholly-owned subsidiary of Tata Sons Private Ltd, last year.
As per the notification, Air India has submitted the relevant markets, with respect to horizontal overlaps. These are the market for domestic passenger air transport services in India, the market for the provision of domestic air cargo transportation services in India, and the market for the provision of charter flight services in India.
About AirAsia
AirAsia India, which started flying in June 2014, offers scheduled air passenger transport, air cargo transport, and charter flight services in the country.
It does not have international operations. According to the notice, the proposed combination will not lead to any change in the competitive landscape or cause any appreciable adverse effect on competition in India, irrespective of the manner in which the relevant markets are defined.
According to the notice, the proposed combination will not lead to any change in the competitive landscape or cause any appreciable adverse effect on competition in India, irrespective of the manner in which the relevant markets are defined.
Tatas took over Air India and Air India Express in January this year. In October 2021, Tatas emerged as the winning bidder for loss-making Air India. It offered a bid of Rs 18,000 crore, comprising cash payment of Rs 2,700 crore and taking over the carrier’s debt worth Rs 15,300 crore.