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Initial discussions to this end began, even as the conglomerate approached another agreement to acquire a stake in the second largest Indian airline, Jet Airways, with its founder Naresh Goyal.
The Tata group's holding proposes to "leave AirAsia India and run the only full-service private airline in India, Vistara-plus-Jet," said one of its collaborators. Tata Sons owns 51% of AirAsia India, the rest being held by Malaysia-based AirAsia Bhd.
Tata Sons, AirAsia and Singapore Airlines declined to comment on what they said about speculation.
It will not be easy to find a buyer for the stake in Tata, given the small size of AirAsia India, its expansion to the pace of snails, its losses and, most importantly, the Central Bureau of Investigation (CBI) investigation into allegations of lobbying and irregular transactions by AirAsia Bhd Tony Fernandes, CEO, and other AirAsia executives. Alternatively, Fernandes could look to sell, said one of the people.
"With the lawsuits against him, Tony has more and more difficulty doing business in India," said one of the officials. "But he will not leave without getting a good value for the participation of his airline."
One of the options being considered is to create a full-service brand – Vistara, merged with Jet – and an equivalent of SIA's low-cost carrier Scoot, which last year absorbed budget carrier Tigerair. Nevertheless, acquiring AirAsia India completely may not make much sense for the Tatas.
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<p> "This could be an unsavory proposition for Tatas," said one close to development. "The airline would have very few resources, except the license and slots, because the reservation systems, infrastructure, accounting, etc., are all managed and managed by AirAsia Berhad or its companies from Malaysia. "Another option might be to close the airline, but this has only been seen by Malaysia. as a distant possibility, said the people quoted above.
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<p> AirAsia India aircraft were leased to a company formerly a subsidiary of AirAsia Bhd. Its activities were transferred to companies managed by BBAM Ltd, one of the largest aircraft portfolio managers in the world, as part of a transaction will see the transfer of ownership of 182 jets. AirAsia India operates a leased fleet of 19 Airbus A320s. It can not be determined whether the aircraft will be transferred to BBAM and whether leases can be retained or renewed.
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<p> Tata Sons announced the two projects in 2013. AirAsia India started with a first capital injection of $ 30 million, while Vistara started with $ 100 million. Tata first owned 30% of AirAsia India's capital before raising it to 49% and then 51% to better control its operations.
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<p> The Tata-SIA partnership ratio of 51:49 has remained unchanged since the beginning. AirAsia India quickly made its debut with frequent clashes between management and Indian founders, mainly about operational control and decision-making entirely to the Malaysian company, which ensured that many contracts, including the rental of aircraft, be granted to its own subsidiaries and affiliated companies. AND reported these issues in December 2015.
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<p> Deloitte's 2016 report of scientific expertise revealed allegedly irregular transactions with fictitious companies, at the request of its first CEO, Mittu Chandilya. This became a key part of the feud that followed the ousting of Cyrus Mistry as president of Tata Sounds.
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<p> The allegations of the Deloitte Report were taken over last year by the Enforcement Branch as a result of a complaint from the Subramanian Swamy ideologue. Following numerous executive resignations over the past three years that have affected expansion projects, the Tata group sought to stabilize the carrier by appointing Sunil Bhaskaran, previously at Tata Steel, as CEO in October. . Prior to that, Deepak Mahendra, a veteran of Tata Power, had been appointed chief financial officer.
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<p> Earlier this year, the IWC alleged that Fernandes and his colleagues and badociates would have facilitated bribes to officials in order to ease the rules governing overseas flights by Indian carriers. AirAsia refuted the charges contained in the IWC's first information report. Investigations are ongoing and the government has retained overseas flight rights on AirAsia India but also on Vistara.<br />
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