IndiGo Keen To Acquire Air India

Photo: Bangalore Aviation

IndiGo has formally written to the Indian government, expressing interest in acquiring Air India and its subsidiary Air India Express.

This was made public in a letter to India’s Ministry of Civil Aviation disclosed on parent InterGlobe Aviation’s stock exchange page. In it, IndiGo president Aditya Ghosh says the low-cost carrier is interested in acquiring “the international airline operations” of Air India and Air India Express.

“Alternatively, we are equally interested in acquiring all of the airline operations of Air India and Air India Express,” he adds.

“We would like to point out that our confidence and ability to build for our country one of the world’s largest international carriers is driven by the significant domestic network we have built over the years. In our view, no other carrier is better placed to realise this potential and we would not even dream of embarking on such a journey but for our domestic feed network.”

He elaborates that India has over time allowed disproportionate access to airlines of some countries in the Middle East and Southeast Asia, allowing these airlines to build massive hubs that have “significantly benefited at the expense of India”.

“As a consequence of this, India’s international air transportation hubs reside outside the geography of our country. It is time for India to take back its fair share of international traffic, and bring back this economic wealth to where it rightfully belongs,” says Ghosh.

IndiGo’s disclosure comes a day after the announcement that New Delhi has given in-principle approval for the privatisation of Air India and its five subsidiaries. A committee, chaired by finance minister Arun Jaitley, will also be formed to consider options for privatising the flag carrier.

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The committee will look into the airline’s debt level, the possibility of hiving off certain assets into a shell company, unmerging and strategic divestment of three of its profitable subsidiaries, the percentage to be divested, and the selection of bidders.

IndiGo is India’s largest domestic carrier, with government data showing that it has a 41% share of the domestic market – far outweighing Air India’s 14%. On international routes, however, Air India has the largest market share with 17%.

Source: flightglobal.com

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