Singapore Airlines (SIA) has decided not to proceed with its bid for Air India.
SIA said that it had always been keenly interested in Air India and hoped that, in collaboration with the Tatas, it would be able to turn Air India around and make it a successful airline. SIA did not think that it would be an easy endeavour, but was surprised by the intensity of opposition to the privatization of Air India from various quarters including certain sections of political groups, trade unions and of the media. In such an adverse climate, SIA is not confident that it can play a useful and effective role.
The slowdown of the world economy is seriously affecting the international airline business and it is unclear how long this will last or how serious the effects will be. Furthermore, SIA`s investments in Australasia are demanding more attention and require a commitment of substantial financial resources.
All these factors have led SIA to the inevitable conclusion that the continuation of its bid for a stake in Air India would not be in the best interests of the parties involved.
India will always remain an important market for SIA. SIA will continue to support fully the development of the Indian aviation industry.
SIA would like to thank the Indian Government, in particular the Department of Disinvestment, for the very professional manner in which it is conducting the privatization exercise.
SIA would also like to thank its partner for the bid, Tata Sons Ltd, for their cooperation. The relationship between SIA and the Tata Group remains strong and harmonious.