On Friday, Salt-to-software business tycoon-Tata Sons won the bid to gain debt-laden state-run national carrier Air India, offering Rs 18,000 crore to acquire 100 percent shareholding.
After remitting the government regulation, the company arranged a winning bid of Rs 18,000 crore to re-acquire the airline for more than half a century. The government will get Rs 2,700 crore cash from Tatas to trade its 100 percent stake.
"Talace Pvt Ltd of Tata Sons is the winning bidder at Rs 18,000 crores. The transaction is expected to close by the end of December 2021," said Tuhin Kant Pandey, secretary, Department of Investment and Public Asset Management (DIPAM).
Further, he added, "Tatas will have to retain all employees of Air India for one year but can offer a voluntary retirement scheme (VRS) in the second year."
Tata Sons' winning bid of Rs 18,000 cr for Air India was more distinguished than the government's reserve price of Rs 12,906 crore.
Attributing a message and a photo, Ratan Tata tweeted "Welcome back, Air India" after winning the bid.
Stating it as a historic and celebrated moment, Tata Sons chairman N. Chandrasekaran also declared a statement saying, "At the Tata group, we are delighted to be declared as the winner of the bid for Air India. This is a historic moment, and it will be a rare privilege for our Group to own and operate the country’s flag bearer airline. We will endeavor to build a world-class airline that makes every Indian proud. On this occasion, I would like to pay tribute to JRD Tata, pioneer of Indian aviation, whose memory we cherish.”
Tata Sons quashed SpiceJet promoter to acquire Air India. Ajay Singh, SpiceJet's chairman, and managing director, also issued a statement congratulating the Tata Group on winning the bid.
"I congratulate the Tata Group on winning the bid for and wish them all the success. It was my honor and privilege to be shortlisted for bidding. I am confident that the Tata Group will restore the glory of Air India and make all of India proud," he said in a statement.
The statement further read, "I would also like to congratulate the Government on the successful disinvestment of Air India. They ran a transparent and flexible process and gave new impetus to India’s disinvestment program. I have been an Air India fan all my life, and it’s time for the Maharaja to reclaim its position as a leading airline of the world.”
The DIPAM secretary announced Tatas' bid of Rs 18,000 crore covers carrying over 15,300 crores of debt and paying the rest in cash.
He stated both bidders had quoted above the reserve price, continuing that the transaction would be closed by December.
He said a group of ministers comprising Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, Commerce Minister Piyush Goyal, and Civil Aviation Minister Jyotiraditya Scindia had cleared the winning bid for Air India on October 4.
This signifies the arrival of Air India to the Tatas.
Jehangir Ratanji Dadabhoy (JRD) Tata established the airline in 1932. It was called Tata Airlines then. In 1946, the aviation division of Tata Sons was registered as Air India. In 1948, Air India International was propelled with flights to Europe.
The international service was among the first public-private partnerships in India, with the government retaining 49 percent, the Tatas holding 25 percent, and the public having the rest.
In 1953, Air India was nationalized. The government markets 100 percent of its stake in the state-owned national airline, including Air India's 100 percent shareholding in AI Express Ltd and 50 percent in SATS Airport Services Private Ltd.