AirAsia India to be based in Chennai after government OKs joint venture
The Star/Asia News NetworkAirAsia is said to have received the nod from India's Foreign Investment Promotion Board (FIPB) to take up a 49-percent stake in a joint venture to set up AirAsia India. This is in contrast to a media report out of India claiming that the deal had hit a snag.
March 8, 2013, 1:36 pm TWN
The new airline, to be based in Chennai and managed by AirAsia, would involve Tata Sons Ltd. taking a 30-percent stake and Arun Bhatia's investment firm Telestra Tradeplace PVT Ltd. taking the remaining stake. AirAsia would initially invest US$15 million.
Earlier media reports out of India claimed that the deal had hit a snag because the Indian Aviation Ministry was said to have reservations about the deal.
Mumbai-based The Economic Times reported that the ministry was understood to have expressed reservations in a note to the FIPB.
The newspaper reported that the ministry's reservations rested on the issue of whether the revised foreign direct investments in aviation rules were applicable to new joint ventures or only existing companies in the industry.