The widely anticipated merger of Indian airline Vistara into Air India will see Singapore Airlines (SIA) getting a 25.1 per cent stake in the enlarged entity for an additional investment of $360 million.
The Tata Group will remain the bigger partner in Air India postmerger, with a 74.9 per cent stake.
Tata currently holds 51 per cent of Vistara, while SIA has 49 per cent.
The merger is expected to be completed in March 2024.
SIA's capital injection into the new Air India group could rise by another 50.2 billion rupees (S$880 million) if the Indian carrier decides to tap both its shareholders for additional funds for restructuring and expansion.
The exact amount of additional investment by each partner will be calibrated to maintain the 25.1 per cent-74.9 per cent respective stakeholdings of the two parties.
SIA will fund its investment from internal sources, which include $17.5 billion in cash and bank balances, and $2.2 billion in committed lines of credit.
SIA and Tata together initially invested about $100 million to start up the Vistara venture in 2013.
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