Tata Sons may increase Airasia India stake to 51%

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NEW DELHI: India’s Tata Sons Ltd may increase its stake in AirAsia India to 51 per cent by buying the shares held by two minor partners, the Times of India reported today.

AirAsia Group Bhd and Tata Sons each have 49 per cent stake in the India-based airline while the remaining two per cent stake is held by AirAsia India Chairman S. Ramadorai and Non-Executive Director R. Venkataramanan.

Following the acquisition, Tata Sons will gain control of the airline.

Under Indian laws, a foreign entity cannot have a controlling stake in a domestic carrier.

AirAsia India was initially launched as a three-way joint-venture, with AirAsia Bhd owning 49 per cent, and Indian partners Tata Sons and businessman Arun Bhatia’s Telestra Tradeplace Pvt Ltd controlling 51 per cent shareholding.

Bhatia left the venture in 2016 after selling his 9.94 per cent stake to Tata Sons, Ramadorai and Venkataramanan.

The Times of India, citing an unnamed source, reported that the board of Tata Sons had discussed acquiring Ramadorai and Venkataramanan’s stakes in AirAsia India but no date was fixed to close the transaction.

In May, India’s Central Bureau of Investigation (CBI) launched a probe into alleged corruption and violation of rules by AirAsia India in obtaining flying permits.

The airline has denied any wrongdoing and promised full cooperation in the investigation. - Bernama