AirAsia in final talks with Tata Group to exit India: sources

Frill-free carrier AirAsia is in the last lap of negotiations to sell its remaining stake in AirAsia India to its joint venture partner Tata Group, two sources close to the matter said. The Malaysian company holds 16.33% of AirAsia India, while Tata currently controls 83.67%. Talks between the two sides began earlier this year and gained momentum after the Indian government announced Tata's successful bid to take over national flag carrier Air India last month, said the sources, who requested anonymity. The negotiations are expected to be concluded by early next year, said one source, the same time as Tata is due to take over Air India's operations. AirAsia has been eyeing an exit from its Indian venture for almost a year. In December 2020 it announced the disposal of a 32.67% stake to Tata Sons for $37.7m, with a provision to sell the remaining 16.33% for $18.8m. AirAsia India at present has a fleet size of 33 aircraft and operates about 200 flights daily. If the sale is finalized, India would be AirAsia's second foreign venture to collapse since the coronavirus pandemic paralyzed air travel amid movement restrictions and international border closures, after Japan in October 2020. "India was a tough market to break as far as [the] airline business is concerned, and with the pandemic, it made it tougher for AirAsia," said one of the sources. AirAsia founder and group CEO Tony Fernandes declined to comment when asked about the discussions with Tata. "It would not be fair for them (Tata)," he said. <br/>