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Air India-Indian merger okayed by Ministry of Corporate Affairs

Air India-Indian merger okayed by Ministry of Corporate Affairs
PTI
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First Published: Tue, Aug 21 2007. 07 28 PM IST
Updated: Tue, Aug 21 2007. 07 28 PM IST
New Delhi: The Ministry of Corporate Affairs has approved the merger of Air India and Indian, clearing the last major hurdle in creating a unified national carrier.
The approval for the proposed combined entity National Aviation Company of India Ltd (NACIL) has been sent to the civil aviation ministry. An official notification is likely to be issued tomorrow, sources in the Ministry of Corporate Affairs said.
The two carriers had approached the corporate affairs ministry under Section 396 of the Companies Act, 1956 for their dissolution and registration of NACIL. As per this section, the ministry has the power to allow merger of public sector enterprises in public interest.
The MCA’s approval came despite objections raised by employees and staff unions. In a public hearing on 31 July 2007, more than 17 complaints regarding wage revision, arrears and pensions were filed.
However, sources said, the corporate affairs ministry has rejected all the objections filed by the unions.
The unions had said that all statutory dues and arrears should be cleared before the merger process goes ahead.
The approval by the corporate affairs ministry would pave the way for the amalgamation of the two airlines. The new entity is proposed to be called Air India. After the merger, the two carriers will transfer their total authorised share capital of over Rs15 crore to the new entity.
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First Published: Tue, Aug 21 2007. 07 28 PM IST