Tata Sons will hike its stake in AirAsia India to 49 per cent by acquiring additional shares from Arun Bhatia’s Telestra, which will be exiting the no-frills airline. Telestra Tradeplace holds nearly 10 per cent stake in the low-cost airline.
While Tata Sons would buy 7.94 per cent shareholding, the remaining stake would be purchased by the carrier’s two directors — S Ramadorai and R Venkataramanan, in their individual capacity. Ramadorai, who is chairman of AirAsia India, and Venkataramanan would acquire 0.5 per cent and 1.5 per cent shareholding, respectively.
The development comes against the backdrop of Arun Bhatia expressing unhappiness over the state of affairs at the carrier. Besides, there have been concerns in certain quarters about control and ownership at the airline. Last month, the airline appointed Amar Abrol as CEO replacing Mittu Chandilya.
The deal is expected to be completed next month, subject to relevant corporate approvals and processes, a Tata Sons statement said. In this regard, an agreement was inked on March 14 by Tata Sons with Air Asia (India) Ltd, Telestra Tradeplace Pvt Ltd, Ramadorai and Venkataramanan. Malaysia’s AirAsia Berhad would continue to hold 49 per cent stake in the airline. Since its inception, AirAsia India witnessed some high profile exits like Vijay Gopalan, former CFO and Gaurav Rathore, former commercial officer. In 2014, AirAsia carried 3.28 lakh passengers in the domestic market which subsequently increased by 329.87 per cent to 14.10 lakh passengers in 2015. This is significant lower than most of its peers. “AirAsia needs to add more aircraft in its fleet and expand the route network. Otherwise it will be impossible to sustain in the immensely competitive market,” said an industry expert who did not want to be identified. FE