The ailing Air India is being sold after 69 years in the hands of the Indian state

Air India airline returned to the hands of its historic founders on Thursday after several decades of being nationalized by the Indian state and severely draining the country’s public finances due to serious financial difficulties.

Tata, a sprawling family conglomerate whose businesses range from tea and software to steel production and car manufacturing, is back at the helm of Air India after inking a 180 billion rupees ($2.4 billion) deal in October .

The transaction marks the end of a long search for a buyer by the Indian government, which has spent nearly $15 billion supporting the airline since 2009.

As of August 31, the airline had accumulated a total debt of Rs.615.62 billion. Under the agreement signed in October, Tata has pledged to assume around a quarter of that debt, or Rs 153 billion, with the remainder to be transferred to a separate legal entity.

For Tata, the acquisition of what is now India’s largest international airline is part of an ambitious program.

The conglomerate, which owns 51% of Indian airline Vistara – Singapore Airlines owns the remaining 49% – as well as an 84% stake in AirAsia India, will now seek to bring them together.

Air India has a fleet of around 120 aircraft, as well as 4,400 landing and parking slots at domestic airports and 1,800 slots at international airports. The airline operates 50% of all international flights from India.

This operation saw the company return to its historic founders: Tata had founded the airline in 1932 under the Tata Air name before being nationalized in the 1950s.

In the 1990s, faced with competition from Gulf airlines and low-cost carriers on domestic and international routes, Air India began to rack up huge losses and debts.

In January 2020, the Indian government announced that it was selling all of its public airline, Air India, in an alarming financial situation after an initial attempt at partial privatization failed.

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