Air India-Vistara Merger: Government Approves Foreign Investment

Air India-Vistara Merger: The Indian government has approved foreign direct investment (FDI) for the merger of Air India and Vistara, according to an announcement from Singapore Airlines on Friday. This approval allows Singapore Airlines to invest S$360 million (about $276 million) into the new combined airline group. This merger will create one of the largest airline groups globally.

Timeline and Merger Details

The deal between Singapore Airlines and Tata Group-owned Air India is expected to be completed by the end of this year. Singapore Airlines will acquire a 25.1% stake in the new merged carrier. With the FDI approval now in place, along with other necessary clearances, the merger process is set to move forward more quickly.

Merger Status and Expected Completion

The merger plan was finalized in November 2022. Tata Group, which owns Air India, currently runs Vistara in a joint venture with Singapore Airlines, where Singapore Airlines holds a 39% stake. The completion of the merger is now anticipated by the end of 2024, though there might be a possibility of extending the deadline from the earlier expected date of October 31, 2024.

Impact and Future Announcements

The merger will make Singapore Airlines the only foreign airline with a significant stake in an Indian airline, giving it a larger share in one of the fastest-growing travel markets.

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Singapore Airlines will announce further updates on the merger’s completion or any significant changes.