Tata Sons, the holding company of the Tata group of companies, is in advanced talks to acquire a significant stake in the troubled airline, Jet Airways, as reported by Reuters. The airline, promoted by entrepreneur Naresh Goyal, has been scouting for investors to tide over its financial difficulties.
Though news reports yesterday suggested that Tata had already begun due diligence to check the viability of the investment, Reuters has noted that this is not the case. But the steel-to-tea conglomerate is very much interested in Jet Airways. “The first step is to see if the economics are viable, if it makes sense from the cost and strategy perspective, and if Tata can make it work with its other aviation businesses,” the story said.
Earlier, it was reported that US airline major, Delta Airlines, was looking to buy Naresh Goyal’s and Etihad Airways’ stake in Jet. This would have allowed Delta to have a controlling stake of 51 per cent in the airline.
In the past few years, Tata has made strategic investments to become a major player in India’s aviation market, which is dominated by Indigo airlines (in domestic traffic). It has a Joint Venture (JV) with Singapore Airlines in the form of Vistara (a premium carrier) and is also invested in Air Asia’s India operations (a low-cost carrier).
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