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Friday, 19 April, 2019, 14 : 30 PM [IST]

Tatas raise stake in AirAsia India to 51%

Tata group has increased its stake in AirAsia India to about 51% and, along with its partner AirAsia Investments, infused INR 500 crore into the budget airline to fund its international growth plans.

With this the group has consolidated its position in the aviation sector, holding controlling stake in two airlines — the second being Vistara that is 49% owned by Singapore International Airlines. Earlier, both Tata group and AirAsia had 49% stake each with R Venkataramanan, Managing Partners, Tata Trusts and S Ramadorai, Group Executive, Tata Group holding the rest. 

“Stake allocation to Venkataramanan and Ramadorai was a business decision and the group now owns 51% in the airline,” one of the sources said. Documents accessed by ET show that the airline has got an infusion of INR 500 crore on April 8, 2019, and 51% of it came from Tata group.
 
This is the first time since the airline’s inception in 2014 that Tata group has become the largest shareholder. The airline was started with 49% shareholding by AirAsia Group, 30% by Tata group and 21% owned by Arun Bhatia’s Telestra Tradeplace. Bhatia exited the airline in 2016, and Tata Sons, Venkataramanan and Ramadorai bought its stake. Tatas also took management control of Air Asia India recently with group representatives now holding key posts. Sunil Bhaskaran, CEO & MD, AirAsia a Tata Steel veteran, took over as of the airline in November last year. The earlier CEOs — Mittu Chandilya and Amar Abrol — were selected by AirAsia Berhad and its CEO Tony Fernandes.

Tata group is increasing stake in AirAsia India at a time when the airline and Fernandes are being investigated by the Central Bureau of Investigation for allegedly bribing government officials to get a waiver in the foreign flying eligibility norms of five years and 20 aircraft. 

 
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