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AI chief promises seamless merger

P. S. Suryanarayana

It can legally merge with Indian by March 2007

SINGAPORE: Air India (AI), which is "on the verge of a merger" with Indian to "become one of the 20 largest airlines in the world," has, at the same time, "finalised plans for joining a global alliance."

AI Chairman and Managing Director V. Thulasidas told The Hindu in Singapore that "a seamless merger" would help chart the new entity's flight-path into the future. Air India led the initiative for joining a global alliance of airlines, but the event was likely to occur only after the merger, according to Mr. Thulasidas. He did not wish to disclose the identity of the global alliance at this stage.

Under a timeline drawn up by Accenture and its consortium partner, Ambit, both consultants for the proposed AI-Indian venture, "the two companies can legally merge by March 2007." Thereafter, it would take another 12-18 months for "the entire integration" of these two public sector units that were "complementary" in "a perfect match."

The merger process had reached the take-off stage, with the Empowered Group of Ministers likely to meet in November to finalise the modalities and set the stage for Cabinet approval.

No retrenchment

The AI employees were assured that there would be no retrenchment and their career prospects would indeed brighten. With this, the labour unions were "quite gung-ho and optimistic about the merger" with Indian. The prospective merger was not linked to any privatisation plans of the Indian Government in the civil aviation sector. But the Government still held on to a plan for an initial public offering (IPO), which might now take place as a "combined" exercise after the merger, he said.

He was here to participate in a ceremonial function at the Changi Airport on Sunday for the launch of the Singapore-Chennai low-fare service of Air India Express (AIE), the fully owned subsidiary of AI.

Singapore's Acting Director-General of Civil Aviation, Chiang Hai Heng, and India's High Commissioner to Singapore Alok Prasad emphasised the importance of air connectivity for bilateral ties. The Chief Operating Officer of AIE, Palvinder Pal Singh, and Air India Singapore Manager Baskaradoss, besides C. Rajendiran, First Secretary (Commercial) in the Indian Embassy, participated.

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AI chief promises seamless merger

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