Vistara-Air India merger: The Indian government has given its nod to Singapore Airlines for foreign direct investment under the proposed merger of Vistara with Air India. With the necessary approvals secured, the merger in which Singapore Airlines will acquire a 25.1 per cent stake in Air India is expected to be finalized by the end of this year.

This proposed merger was announced in November 2022.

While Air India is owned by Tata Group, Vistara is a 51:49 JV between Tata and Singapore Airlines.

In a regulatory filing on Friday, Singapore Airlines (SIA) announced that it has received approval from the Government of India for Foreign Direct Investment (FDI) into the expanded Air India as part of the proposed merger.

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In the filing the airlines said the FDI approval is a “significant development towards the completion of the proposed merger”. The airline also stated that the merger’s completion remains contingent on the parties’ compliance with applicable Indian laws, with finalisation anticipated in the coming months.

“At this juncture, completion of the proposed merger is anticipated to occur by the end of 2024,” it added. Singapore Airlines has indicated that the parties are in discussions to extend the long stop date for completing the merger, which was initially expected by October 31, 2024.

The merger, which will create one of the largest airline groups, was approved by the National Company Law Tribunal (NCLT) in June.

In March, Singapore’s competition regulator CCCS conditionally approved the proposed deal. Earlier, in September 2023, the Competition Commission of India (CCI) also gave its approval, subject to certain conditions.

“SIA will make the necessary announcement(s) upon completion of the proposed merger or in the event that there are other significant developments,” the filing said.

(With PTI inputs)