Air India, which was recently acquired by Tata Sons Private Limited (TSPL), has proposed to buy the remaining stake in low cost carrier AirAsia India.
According to a filing with the Competition Commission of India (CCI), Air India has offered to buy the entire equity share capital of AirAsia India.
Currently, TSPL holds 83.67% of the equity share capital of AirAsia India.
AirAsia Investment Ltd (AAIL), which is part of Malaysia’s AirAsia Group, holds the remaining 16.33% of shares.
AirAsia India provides domestic passenger, air cargo transport and charter flight services in the country. It does not operate on international routes.
A CCI notice said: “The Proposed Combination will not lead to any change in the competitive landscape or cause any appreciable adverse effect on competition in India, irrespective of the manner in which the relevant markets are defined.”
However, the combination may result in overlaps in operations in certain markets.
This comes as Air India is seeking to turn around under the new ownership of TSPL, following the $2.4bn equity-and-debt deal for the acquisition of the state-run carrier in January.
The deal included full-service carrier Air India, the low-cost arm Air India Express and ground handling and cargo services AI SATS.
At that time, Tata Sons chairman N Chandrasekaran said: “We are excited to have Air India back in the Tata Group and are committed to making this a world-class airline.”
The CCI application also marks the first step by TSPL to consolidate its aviation business, which also includes a joint venture with Singapore Airlines, called Vistara.