Tata Sons and Singapore Airlines have signed a memorandum of understanding and applied for Foreign Investment Promotion Board (FIPB) approval to establish a new airline in India, the Tata Group said in a media release.
"Subject to FIPB and other regulatory approvals, the airline will be based in New Delhi and will operate under the full-service model. Tata Sons will own 51 percent and Singapore Airlines will own 49 percent," it said.
The initial board will have three members, two nominated by Tata Sons and one nominated by Singapore Airlines. The chairman will be Prasad Menon, nominated by Tata Sons.
"It is Tata Sons' evaluation that civil aviation in India offers sustainable growth potential. We now have the opportunity to launch a world-class, full-service airline in India. We are delighted that we are partnering in this endeavour with the world-renowned Singapore Airlines," said Menon.
Singapore Airlines CEO, Goh Choon Phong, said "We have always been a strong believer in the growth potential of India's aviation sector and are excited about the opportunity to partner Tata Sons in contributing to the future expansion of the market."
Goh added: "Tata Sons is one of the most established and respected names in India. With the recent liberalisation, the time is right to jointly bring consumers a fresh new option for full-service air travel. We are confident the joint venture airline will help to stimulate market demand and provide economic benefits to India."
Details of the airline's branding, management team and products and services will be announced in due course, Tata said.
The tie-up is the second airline joint-venture announced this year by the Tata Group, which announced announced plans for a low-fare airline based in the south Indian city of Chennai with Malaysia's AirAsia in February.
--IBNS (Posted on 20-09-2013)