November 29, 2022: Singapore Airlines (SIA) and Tata Sons (Tata) have agreed to merge Air India and Vistara, with SIA also investing Rs 20,585 million (S$360 million, US$250 million) in Air India as part of the transaction.
This would give SIA a 25.1% stake in the Air India group with a significant presence in all key market segments. SIA and Tata aim to complete the merger by March 2024, subject to regulatory approvals.
SIA intends to fully fund this investment with its internal cash resources, which stood at S$17.5 billion as of September 30, 2022.
SIA and Tata have also agreed to participate in additional capital injections, if required, to fund the growth and operations of Air India in FY2022-23 and FY2023-24.
Based on SIA’s 25.1% stake post-completion, its share of any additional capital injection could be up to Rs 50,200 million (S$880 million, US$615 million), payable only after the completion of the merger.
The actual amount will depend on factors including the progress of the enlarged Air India’s business plan, and its access to other funding options. SIA intends to fully fund any additional capital injections with its internal cash resources.
STORY HIGHLIGHTS
Singapore Airlines (SIA) and Tata Sons (Tata) have agreed to merge Air India and Vistara, with SIA also investing Rs 20,585 million in Air India as part of the transaction
November 29, 2022: Singapore Airlines (SIA) and Tata Sons (Tata) have agreed to merge Air India and Vistara, with SIA also investing Rs 20,585 million (S$360 million, US$250 million) in Air India as part of the transaction.
This would give SIA a 25.1% stake in the Air India group with a significant presence in all key market segments. SIA and Tata aim to complete the merger by March 2024, subject to regulatory approvals.
SIA intends to fully fund this investment with its internal cash resources, which stood at S$17.5 billion as of September 30, 2022.
SIA and Tata have also agreed to participate in additional capital injections, if required, to fund the growth and operations of Air India in FY2022-23 and FY2023-24.
Based on SIA’s 25.1% stake post-completion, its share of any additional capital injection could be up to Rs 50,200 million (S$880 million, US$615 million), payable only after the completion of the merger.
The actual amount will depend on factors including the progress of the enlarged Air India’s business plan, and its access to other funding options. SIA intends to fully fund any additional capital injections with its internal cash resources.