Antitrust regulator CCI clears merger of Air India and Vistara

Competition Commission of India has given greenlight to the merger of Air India and Vistara. The move makes the consolidation efforts of Tata group's airline business one step forward. "CCI has approved the merger of Tata SIA Airlines into Air India, and acquisition of certain shareholding by Singapore Airlines in Air India subject to compliance of voluntary commitments offered by the parties, " the anti trust regulator said in a statement.

Sources said that the regulator has asked to maintain current capacity on certain routes primarily on Europe and North American routes.

Tata Sons and Singapore Airlines (SIA) will merge Air India and Vistara to create India’s second-biggest carrier. SIA will hold a 25.1% stake in the entity with an equity infusion of Rs 2,058.50 crore. Tata will hold the rest.


The deal is part of Tata Sons chairman N Chandrasekaran’s effort to simplify the conglomerate’s businesses and make them more efficient.


CCI had not given expedited approval to the merger and had instead asked both the companies to clarify how it will not hurt competition on domestic and international routes.

Phase 1 approval is given by CCI within 30 days if it finds that the transaction is unlikely to cause an adverse effect on competition. If the body forms an opinion that the merger or acquisition is likely to cause an adverse impact on the competition scenario in the sector it sends show cause notice on further review which may take up to 210 working days. On April 19, the Tata owned airlines Air India had approached for a merger.

According to data analytics firm Cirium, the entity will have 49% of the total flights on the Delhi-Mumbai route. IndiGo also has a strong presence on the route with 31% of total flights. Similarly, on Delhi-Bengaluru, the second busiest, the combined Air India group will have 52% share of total flights. IndiGo has a 35% share.

On the international sector, the Air India group will enjoy a significant advantage on Delhi-Dubai with 23% of total flights. Emirates, IndiGo and SpiceJet also have a strong presence on the route.