New Delhi: Tata Sons will hike its stake in AirAsia India to 49 percent by buying additional shares from Arun Bhatia's Telestra which will be exiting the venture amid concerns over ownership and control at the low cost carrier.
With the deal, Tata Group and Malaysia's AirAsia Berhad would have 49 per cent stake each in the no-frills airline - which only this month announced a top-deck reshuffle that would see Amar Abrol taking over as CEO from Mittu Chandilya effective April 1.
AirAsia India, which began operations in June 2014, is now a three way joint venture. Telestra Tradeplace holds nearly 10 per cent stake in the airline.
While Tata Sons would buy 7.94 percent shareholding, the remaining stake would be purchased by the carrier's two directors - S Ramadorai and R Venkataramanan - in their individual capacity.
Ramadorai, who is chairman of AirAsia India, and Venkataramanan would acquire 0.5 percent and 1.5 per cent shareholding, respectively.
In December last year, Arun Bhatia had expressed unhappiness over the state of affairs at the budget carrier.
On Tata Group hiking stake and directors buying shares, AirAsia Group CEO Tony Fernandes said it was great to see that they are so confident about AirAsia India's future.
In a release today, Tata Sons said it would raise its stake in the airline to 49 percent from 41.06 percent by acquiring 7.94 percent equity stake from Telestra.
"Ramadorai and Venkataramanan, in their individual capacity, propose to acquire 0.5 percent and 1.5 per cent shareholding, respectively of Telestra's remaining 2 percent equity stake in the company," it said.
The deal is expected to be completed next month, subject to relevant corporate approvals and processes, the release added.
In this regard, an agreement was inked on March 14 by Tata Sons with Air Asia (India) Ltd, Telestra Tradeplace Pvt Ltd, Ramadorai and Venkataramanan.
"Great to see Tata and board members so confident on the future of Airasia India. I'm thrilled," Fernandes said in a tweet.
In an apparent reference to concerns being expressed over ownership and control at the airline, Fernandes also said, "not that it was ever an issue but kinda of ends this silly talk driven by one reporter on foreign control"
Last August, Tata Sons had acquired 10 percent stake from Telestra which took the former's overall shareholding then to little over 41 percent.
AirAsia India has a fleet of six aircraft, covering 12 routes and carrying over 1.8 million passengers.