The Board of Directors of Singapore Airlines Limited (SIA) announced the successful completion of the proposed merger between its 49% associated company, Tata SIA Airlines Limited (Vistara), and Air India Limited (AI), marking a significant milestone in the airline’s strategic expansion. The merger, which consolidates Vistara into Air India, has been finalized today, with all conditions precedent fulfilled in accordance with the Implementation Agreement.
Following the completion of the merger, Singapore Airlines now holds approximately 25.1% of the enlarged Air India, which includes Vistara’s operations. As a result, Air India is now classified as an associated company of SIA, while Vistara, as an independent entity, ceases to be part of SIA’s associated companies.
This development follows earlier announcements by SIA, including the first communication on 29 November 2022, which outlined the terms of the proposed merger and SIA’s anticipated stake in the combined entity.
As part of the merger, Singapore Airlines had previously committed to an Additional Capital Injection into the enlarged Air India. Initially, SIA had agreed to inject up to INR 50,200 million (approximately S$880 million at that time), with the final amount to be determined based on various factors.
In a subsequent update on 8 November 2024, SIA revised the expected capital injection amount to INR 31,945 million (approximately S$498 million), which remains unchanged. The expected injection will occur post-merger, with the funds used to support the enlarged AI’s operations and future growth. The final transaction is scheduled for 21 November 2024, and SIA’s equity stake in the combined Air India will remain at approximately 25.1%, unaffected by the revised capital infusion.
SIA intends to fund the Additional Capital Injection through its internal cash resources. The airline has assured stakeholders that any significant updates or developments following the completion of the capital injection will be announced in due course.
This merger marks a key moment in the ongoing transformation of India’s aviation sector, creating a powerful, consolidated national carrier. For Singapore Airlines, this strengthened relationship with Air India enhances its strategic position in the global airline industry, providing greater synergy in operations and an expanded market presence.
SIA’s commitment to this transaction further underscores its confidence in Air India’s future growth and the potential for the combined entity to become a leading player in the international aviation market.
