Ratan Tata tweeted "Welcome back" after Tata Sons won Air India bid
Tata Sons chairman emeritus Ratan Tata today expressed delight after the salt-to-software conglomerate won the bid to acquire debt-laden Air India. Mr Tata, in a statement that he tweeted along with an old photo of former Tata group chairman JRD Tata, said "it will take considerable effort to rebuild Air India", which has a debt of over Rs 60,000 crore and loses Rs 20 crore every day.
JRD Tata founded Air India as Tata Airlines in 1932. It was India's first airline and operated only domestic flights at that time. The airline was nationalised in 1953 and split into two - a domestic airline and an international carrier.
Fast forward to 2009, the government appointed State Bank of India to make a roadmap for the airline's recovery after years of losses under state control and emergency of new players in the aviation sector. In 2018, the government's offer to sell a stake in Air India fails to attract a single bidder by the deadline, with potential buyers citing onerous conditions. In October last year, the government got two bids after extending the deadline several times; the bids were from Tata Sons, and Ajay Singh, promoter of budget airline SpiceJet.
Today, the government announced Tata Sons has won the bid. This deal completes a full circle since 1932 when JRD Tata founded the airline.
"The Tata Group winning the bid for Air India is great news! While admittedly it will take considerable effort to rebuild Air India, it will hopefully provide a very strong market opportunity to the Tata group's presence in the aviation industry," Mr Tata tweeted.
"On an emotional note, Air India, under the leadership of Mr JRD Tata had, at one time, gained the reputation of being one of the most prestigious airlines in the world. Tatas will have the opportunity of regaining the image and reputation it enjoyed in earlier years. Mr JRD Tata would have been overjoyed if he was in our midst today," Mr Tata said in the statement he tweeted. "We also need to recognise and thank the government for its recent policy of opening select industries to the private sector. Welcome back, Air India!" the Tata Sons chairman emeritus tweeted.
The government will get Rs 2,700 crore in cash from the Air India sale to Tata Sons. Tata Sons' winning bid is for Rs 18,000 crore, for which they will get 100 per cent stake in Air India, as well as a 50 per cent stake in its ground-handling company Air India-SATS and Air India Express.