Secretaries’ panel clears IA, A-I merger plan

New Delhi: A committee of secretaries (CoS), appointed to study the merger of Indian Airlines and Air-India, on Monday gave its approval in principle for the merger of the two national carriers.
According to ministry sources, the CoS has also recommended waiving stamp duty for the merger. The merged entity is expected to be headed by a group CMD with SBUs looking after functions like operations, ground handling, cargo, maintenance, and low-cost operations.
Accenture, the consultant appointed by the airlines, estimated that synergies would raise combined revenues by Rs 1,200 crore over four years. At present, the combined annual turnover of the two airlines stands at Rs 15,500 crore. The merger is expected to result in route rationalisation and better aircraft, engineering and human resource deployment. However, merging personnel is expected to pose the biggest challenge, although the government has stated there would be no retrenchment, initially.
11/12/06 Atreyee Dev Roy/Financial Express

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