Arun Bhatia to raise Tata-Singapore Airlines issue at AirAsia board meet

MUMBAI: AirAsia India's investor Arun Bhatia will take up the issue of partner Tata Sons' decision to float a separate joint venture with Singapore Airlines at an upcoming board meet of the company. Bhatia, whose son is married to steel magnate LN Mittal's daughter, has roundly criticised the salt-to-software Tata group for not informing him and AirAsia head honcho Tony Fernandes about the transaction, a claim rebutted strongly by the Tata group.

On Friday, the owner of Telstra Tradeplace called the joint venture with Singapore Airlines "unethical" and said he was "shocked to hear the news".

The AirAsia India board is meeting on September 28. Tata Group directors in the domestic airline will be present in the meeting.

Bhatia told ET that he has no plans to exit the venture, but had offered to buy out the Tatas. Bhatia, the Tata Group and AirAsia formed a three-way joint venture earlier this year to launch a low-fare, no-frills airline in India. Bhatia owns 21%, Tata Sons 30% and the rest is owned by the Malaysian carrier. The Foreign Investment Promotion Board (FIPB) has approved the tie-up and the airline is awaiting other government approvals before launching operations.

On Thursday, the Tatas announced a tie-up with Singapore Airlines, reviving an old partnership whose ambitions were thwarted by political intrigue and corporate rivalry more than a decade ago. In the 90s, the two airlines had tied up for a 40% stake in national Air India, which was put for privatisation. But they pulled out in 2000 citing political resistance and other problems. Tony Fernandes, AirAsia founder, declined to comment. He told ET tersely that he prefers to focus on what he is good at.