The integration of Vistara with Air India, set to be completed on November 12, is almost here. A dedicated “war room” has been established, bringing together teams from multiple departments—customer service, engineering, and operations—to navigate this transition smoothly and avoid any disruptions. Regulatory preparations are nearing completion, including updates to Air India’s air operator certificate.

Singapore Airlines will hold a 25.1% stake in the unified Air India.

The Air India-Vistara merger is expected to be completed within November 2024. For Singapore Airlines, the consideration comprises its 49% interest in Vistara and INR 20,585 million in cash (equivalent to SGD 318 million) in exchange for a 25.1% equity interest in the enlarged Air India.

Upon the completion of the transaction, the Group expects to recognise a non-cash accounting gain of approximately SGD 1.1 billion. At the same time, it will also start equity accounting for its share of Air India’s financial results.

The merger, announced by SIA and Tata Sons in November 2022, includes an agreement for SIA to contribute its share of any funding previously provided by Tata before the completion of the merger, together with relevant funding costs, up to INR 50,200 million (equivalent to SGD 880 million, based on the prevailing exchange rates at that time). This would allow SIA to maintain a 25.1% stake in Air India.

SIA’s additional capital injection is expected to be INR 31,945 million (equivalent to SGD 498 million), based on Tata’s funding to Air India to date. This will occur after the completion of the merger and within November 2024 through subscription to
new Air India shares. Future capital injections will be considered based on Air India’s requirements and available funding options.

Air India and SIA recently agreed to expand their codeshare agreement significantly, adding 11 Indian cities and another 40 international destinations to their network. This marks the first extensive expansion of codeshare arrangements between the airlines since 2010, offering customers enhanced travel options between Singapore and India, as well as beyond. Both carriers will continue to explore ways to deepen their commercial partnership.

As of November 12, Vistara flights will operate under the Air India name with updated four-digit flight numbers starting with “2”. Efforts to unify the inflight service standards for both airlines are underway, with domestic menus aligned across both airlines, and a soft product alignment will be planned for the coming months.

Vistara Management Team Members will move around the other Tata Airlines.

With Vistara’s chapter closing, the management team will be disbanded. Here is where the key management personnel will move around the airline world.

Vinod Kannan, Chief Executive Officer of Vistara, who has also been holding the role of Chief Integration Officer for the full-service airlines’ merger, will continue in the latter role post-merger. He will be a member of the Management Committee and report directly to Air India CEO Campbell Wilson.

Deepak Rajawat, Chief Commercial Officer of Vistara, will take up the Chief Financial Officer role at the newly enlarged Air India Express, reporting to CEO Aloke Singh. He will also support Group CFO Sanjay Sharma in strategic initiatives and projects. Vikas Agarwal, the CFO of Air India Express, will move to a new role in Air India.

Capt. Hamish Maxwell, SVP of Flight Operations of Vistara, has assumed an advisory role for Air India Express CEO Aloke Singh, while Capt. Pushpinder Singh, Chief Operations Officer of Air India Express, returns to flying. A successor for Capt. Singh will be announced in due course.

Deepa Chadha and Vinod Bhatt, SVP of HR & Corporate Affairs and Chief Information Officer of Vistara, respectively, will take on senior roles at other Tata group companies. At the same time, Vistara CFO Mr Niyant Maru, who continued beyond his superannuation date to see through the completion of the merger, will retire at the end of his current term.

Cross-Utilization of Resources

Air India will begin cross-utilizing pilots, cabin crew, and aircraft from both airlines as part of the integration. For instance, Vistara’s Boeing 787 aircraft will support Air India’s routes to Frankfurt and Paris, filling in gaps caused by maintenance schedules. The cross-utilization strategy also extends to the crew, with over 150 Air India cabin crew trained in Vistara’s service standards, enabling deployment on either airline as needed.

Bottomline

Air India and Vistara’s Merger will be up and done over the night of November 11/12, 2024. The airlines will operate as one on November 12, 2024, and the team responsible for running Vistara will go in their different directions.

What do you make of the merger of the two airlines?

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