AirAsia Sells Remaining Stake to Air India
The new AirAsia-Air India deal comes as the former ramps up its focus on Southeast Asia.
The new AirAsia-Air India deal comes as the former ramps up its focus on Southeast Asia.
DALLAS - AirAsia Aviation Group has sold the remaining equity shares in AirAsia (AK) to flag carrier Air India (AI), which the Tata Group owns. The company will receive Rs1.56bn (US$18.8bn), and there will be no gain or loss on the sold shares.
This new agreement comes as AK ramps up its focus on Southeast Asia after the pandemic affected the carrier's business. The carrier will focus on countries such as Thailand, Malaysia, the Philippines, and Indonesia. The Malaysia-based airline said that India is still an important market for them and will continue to serve destinations across the country.
Tata Group owns 83.67% of AK operations in India, with the remaining 16.33% owned by the Malaysia AirAsia Group. As a result of this sale, AI may merge with low-cost carrier Air India Express (IX).
The New Delhi-based carrier is the largest carrier in the country, operating in a variety of international and domestic markets. IX flies short-haul routes from South India to the Middle East.
AirAsia India, which started operations in 2014, was created as part of a joint venture between the Tata Group and AirAsia Malaysia. Back in June, the acquisition of the shares by AI was approved by the Competition Commission of India.
AirAsia Group CEO Bo Lingam said, "We have had a great experience working with India's leading Tata Group. This is not the end of our relationship, but the beginning of a new one as we explore new and exciting opportunities to collaborate and enhance our synergies moving forward… COVID has allowed us to re-examine our priorities, and we felt that it was best suited for AirAsia to develop an Asian-only business, where we have four great airlines– in Malaysia, Thailand, Indonesia, and the Philippines– with a much-loved brand and presence."
He further added, "India will remain an important market for AirAsia and will continue to be served by our various airlines. We will use the experience and knowledge we have gained from operating in the Indian domestic market to grow the Asian-Indian market in logistics and passenger services to a far greater extent."
Since January 2022, AK has flown over 23 million passengers on 171,000 flights across AK-affiliated airlines to destinations across Asia, Europe, and Oceania.
Featured image: AirAsia. Photo: Ratchapon Pipitsombat/Airways
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