MUMBAI: The Indian government has agreed to sell the heavily-indebted Air India to the Tata conglomerate for 180 billion rupees ($2.4 billion), the finance ministry said Friday.
Tuhin Kanta Pandey, head of the government privatisation department, said that Talace Pvt Ltd, a subsidiary of the Tata conglomerate, won the bidding for the airline.
"The transaction is expected to close by end of December 2021," he added.
Tea-to-steel conglomerate Tata founded the airline as Tata Air in 1932 before it was privatised in the 1950s.
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But in the 1990s Air India began to struggle with competition on domestic and international routes from Gulf carriers and no-frills airlines, and the firm started amassing huge losses and debts.
Successive Indian governments tried to privatise the company but its debts and New Delhi's insistence on retaining a stake put off would-be buyers.
Last year Prime Minister Narendra Modi's government, seeking to sell a raft of state assets, agreed to take bids for the entire company but to retain some of what the airline owes.
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Tata also owns 51 percent in Indian airline Vistara -- Singapore Airlines holds the remaining 49 percent -- as well as an 84-percent stake in AirAsia India, all of which Tata will now try to bring together.
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