Air India+Vistara= Air India

What was evident the day the Tatas took over Air India has now become a reality - the merger of four brands into one Air India. It is the first step in a long-haul to recreate the magic of the country's national carrier and give India a world-class airline.

It was the worst kept secret in the world, till finally the Tata Group decided to make it formal on November 11 when they announced the consolidation of Vistara and Air India. "With this consolidation", Air India said in a statement, "Air India shall have a combined fleet of 218 aircraft, making it India's largest international carrier and second largest domestic carrier", behind the leader IndiGo. After the full integration of Vistara and AirAsia India, expected to happen before March 2024, Air India will be the only Indian carrier group to operate both full-service and low-cost passenger services.

Tata Sons had acquired 100 percent stake in Air India in January this year through their fully-owned subsidiary, Talace Private Limited. Vistara, on the other hand is a 51:49 per cent joint venture between Tata Sons and Singapore Airlines Limited (SIA) that was established in 2013 and is India's leading full-service carrier with international operations in Middle East, Asia and Europe. Vistara shall be merged with Air India post receipt of requisite approvals. As part of the merger transaction, SIA shall also invest 2,059 crore in Air India. Post the consolidation, SIA shall hold 25.1 percent shareholding in Air India. The transaction is estimated to be completed by March 2024.

It is a long draw-out process that has to go through multiple regulatory approvals and will take time. This includes approvals from the Directorate General of Civil Aviation, Reserve Bank of India, ministry of civil aviation, Competition Commission of India and the National Company Law Tribunal. Mergers and acquisitions particularly in the aviation business, have been long drawn out, messy and far from satisfactory. The three immediate examples are Kingfisher/Deccan, Jet Airways/Sahara, Air India/Indian Airlines. All there were never able to compete the merger mandate and failed in multiple ways.