Nearly 70 years after the Indian government took over Air India from a reluctant Tatas, the flag carrier returned to its founder, the salt-to-software conglomerate Thursday.

"Totally delighted that this process is complete. Very happy to have Air India back in the Tata group. We look forward to working with everyone to create a world-class airline," Tata Group chairman N Chandrasekharan said at the handover meeting. Chandrasekharan met with Prime Minister Narendra Modi earlier in the day.

Tata group's holding company Talace Pvt Ltd bought Air India for ₹ 18,000 crore (USD 2.4 billion) after it outbid a consortium led by SpiceJet chief Ajay Singh.

"Now, the new owners (of the airline) are Talace Pvt Ld," Department of Investment and Public Asset Management Secretary Tuhin Kanta Pandey told reporters today.said.

Air India is the third airline brand in the Tatas' stable - it holds a majority interest in AirAsia India and Vistara, a joint venture with Singapore Airlines Ltd. The latest deal completes a full circle as Air India was founded in 1932 under the name, Tata Airlines, by family scion and aviation enthusiast JRD Tata.

"On an emotional note, Air India, under the leadership of Mr JRD Tata had, at one time, gained the reputation of being one of the most prestigious airlines in the world. Tatas will have the opportunity of regaining the image and reputation it enjoyed in earlier years. Mr JRD Tata would have been overjoyed if he was in our midst today," Tata Sons Chairman Emeritus Ratan Tata had said in October last year after the group won the bid.

The deal with Tata Sons also includes the government's sale of 50 percent of ground handling arm Air India-Sats, and Air India Express.

The transaction does not include non-core assets including land and building, which are to be transferred to the government's holding company AIAHL, NDTV said. 

Air India's total debt at the time when Tata Sons won the bid stood at over ₹ 60,000 crore (nearly USD 7 billion); the government had been losing nearly ₹ 20 crore/ 200 million INR every day.

Tata faces an uphill task to revive a carrier that hasn’t made money since its 2007 merger with domestic operator Indian Airlines, said the Economic Times. The group already runs two unprofitable joint ventures with Singapore Airlines and AirAsia Group in the country, and has faced criticism for not running those businesses efficiently, even though they contribute a tiny portion to the group’s overall revenue.

(SAM)