On Friday (October 1), a government-led panel held Tata Sons as the winner for the bid on national carrier Air India. In a tweet, Bloomberg reported, “Tata Sons is set to take over Air India. A panel of ministers accepted a proposal from bureaucrats, who recommended the conglomerate’s bid ahead of an offer from entrepreneur Ajay Singh. An official announcement is expected in the coming days.”
Earlier, the Economic Times (ET) reported that the Indian government had chosen the winning bid, after judging the offers made by Spicejet founder Ajay Singh and Tata Sons against a ‘minimum reserve price’. The sale involved 100% ownership of Air India and Air India Express, besides 50% stake in Air India SATS Airport Services Pvt Ltd will now be held by Tata Sons. Citing sources, ET stated that the government had put the minimum reserve price between ₹15000- ₹20000 crores.
While Tata Sons bid ₹3000 crores higher than the said price, Ajay Singh had bid about ₹5000 quoted by Tata Sons. ET stated that the Tata Group had included an indemnity clause in its offer to protect itself from any pre-acquisition claims, with a sovereign guarantee from the Indian government. Reportedly, more than 200 Tata officials were part of the bidding process. The airline was founded by JRD Tata in 1932 as ‘Tata airline’ and was renamed ‘Air India’ in July 1946. It was in July 1953 that the then-Nehru government took over a majority stake in the airline from Tata Sons. At the time, JRD Tata was extremely anguished by the manner Nehru had nationalised Air India without any dialogue or notice.
