Air India has signed agreements to complete the acquisition of 100% of the shares of AirAsia India (AAI) while advancing in the process to merge it with Air India Express, the airline announced on Thursday.
The merger of these two companies, which operate as low cost airlineswill be carried out as part of the planned restructuring roadmap of the Tata group’s airline business and is expected to bring customers, revenue and operating profit through wider adoption of best practices, systems and routes and the largest scale of the combined entity.
A working group has been formed to evaluate and integrate into the AI Group low-cost operations, which will be co-chaired by Sunil Bhaskaran, CEO and MD of AirAsia India and Aloke Singh, CEO of Air India Express. The task force will report to a committee chaired by Air India CEO Campbell Wilson.
The evaluation and implementation of the full integration process of AAI and AIXL, through a possible merger or other scheme and subject to the necessary corporate approvals it is expected to take approximately 12 months, with the network and other synergies that will be realized progressively during this period.
Commenting on the development of the operation, Wilson assured that “this is a key step in the rationalization and transformation of the group and we will be working closely with the management teams and staff throughout the process. We also look forward to the many opportunities that a stronger AI Group low-cost airline will bring to customers.”