Malaysia's AirAsia on Wednesday said it has entered into a pact with Air India to sell its remaining stake in budget carrier AirAsia India.
Tata group and the Malaysian entity-owned AirAsia India started flying in June 2014.
In a statement, AirAsia Aviation Group Ltd. said it has entered into a share purchase agreement to sell the remaining equity shares held in AirAsia India to Air India.
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It did not provide any specific details.
AirAsia India was a joint venture between Tata Sons and Air Asia Investment Ltd. Tata Sons had an 83.67% stake and the latter owned a 16.33% shareholding.
In June, the Competition Commission of India approved the proposed acquisition of the entire shareholding of AirAsia India by Air India.
Group CEO of AirAsia Aviation Group Bo Lingam said that since 2014, "when we first commenced operation in India, AirAsia has built a great business in India, which is one of the world's biggest civil aviation markets".
"We have had a great experience working with India's leading Tata Group. This is not the end of our relationship but the beginning of a new one as we explore new and exciting opportunities to collaborate and enhance our synergies moving forward," he said.
Further, he said, the pandemic has allowed it to re-examine the priorities and "we felt that it was best suited for AirAsia to develop an Asean-only business".
The Malaysian group will continue to have airlines in Malaysia, Thailand, Indonesia and the Philippines.
"India will remain an important market for AirAsia and will continue to be served by our various airlines. We will use the experience and knowledge we have gained from operating in the Indian domestic market to grow the Asean-Indian market in logistics and passenger services to a far greater extent," Bo Lingam said.
Tata group is consolidating its airline business. Air India, Air India Express, Vistara and AirAsia India are part of the group. Vistara is a joint venture with Singapore Airlines.
In January, Tata group acquired Air India and Air India Express.
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