- SUMMARY
- Air India Vistara merger has received the NCLT approval.
- Post merger, TATA Sons will hold 73.38% of Air India.
- Air India will have largest international network spanning five continents.
After a long wait, Air India and Vistara have received their final regulatory approval, which will allow both airlines to move towards the end phase of the merger. The National Company Law Tribunal (NCLT) has approved the merger proposal of both airlines.
Air India Vistara Merger Receives NCLT Approval
TATA Group has received the final regulatory approval from the NCLT. The law tribunal had reserved the order a long time ago, but today, the airlines have received the written copies. Now, the final approval is pending from the Department for Promotion of Industry and Internal Trade (DPIIT).
This NCLT approval will allow both airlines to integrate their fleet and Human Resources. Both can now proceed to integrate their networks. After the merger, Air India will become the largest international carrier of India, with a presence in five out of seven continents.
Post-merger, Singapore International Airlines will be holding a 25.1% stake in the merged entity. TATA Sons Private Limited, the parent company will be holding 73.38% shares. The remaining 1.52% shares belong to SBICAP Trustee Company Limited on behalf of Air India Employee Settlement Trust.
A person in the airline told the Economic Times that both airlines will gradually shift to the same check-in counters at major airports. They will no longer use different resources at airports.
To harmonize the network and fleet of both airlines, the airlines have appointed a lot of consultants like BCG and Sabre, who are working on the integration of Human Resources and the network.
Aiming for a Seamless Integration
Sources told the Economic Times that Air India is aiming to merge both airlines without grounding any aircraft. From June month, the transfer process of staff members from Vistara to Air India will start. Around 7,000 employees have been identified, who would shift from aubergine to red.
Already, the transfer process for the non-flying employees has started, with sixty staffers already shifted from Vistara to Air India. More than 100 pilots have already been transferred between both airlines.
Employees have been told that they will receive their roles in the new organization based on merit. The whole process will be transparent. By the end of this year, the Vistara brand will cease to exist. It is difficult to say whether the TATA-SIA JV airline will complete a decade of operations.
Conclusion: NCLT Approves Air India-Vistara Merger
The merger of Air India and Vistara has received the approval from National Company Law Tribunal (NCLT). With the merger, Air India will become the airline with the largest international network spanning five continents. There is a high chance that the brand Vistara will be liquidated before completing one decade of operations.
What do you think about this latest update on the Air India & Vistara merger? Discuss in the comment section.
Featured Image Credits: Robin Hardy via Air India Facebook
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