Tata Sons, India's oldest and most powerful conglomerate will take over debt-laden national carrier Air India.
India's SpiceJet chief Ajay Singh offered 151bn rupees, but it won with 180bn rupees ($2.4bn).
The government announced Friday that Tata would absorb more than 615 billion rupees in debt burdens from the airlines by announcing the sale.
The government attempted to sell the property in 2018, but it was unsuccessful.
This sale marks the return to Air India of the Tata Group. The Tata Group was a pioneer in Indian commercial aviation and launched it in 1932. It was then taken over by the government in 1953.
Ratan Tata (the chairman emeritus at Tata Sons) tweeted: It's great to see the Tata Group win the bid for Air India. Although it will be a lot of work to rebuild Air India it will provide an opportunity for the Tata Groups to expand its presence in the aviation sector.
The government opened an initial call for expressions of interest in January 2020. This airline operates domestic and international routes, and has suffered huge losses over the past decade.
The Tata Group, a collection of more than 100 companies, includes the largest automaker in the country, the largest private-sector steel company, and a major outsourcing firm. These companies employ over 350,000 people worldwide. Tata purchased Jaguar Land Rover and Land Rover from Ford for $2.3bn in June 2008.
It also operates Air Asia India, a low-cost airline in collaboration with Malaysian carrier Air Asia Berhad and Vistara, a full-service carrier with Singapore Airlines.
Air India was home to more than 18 million passengers in India in 2019. It has been plagued by bureaucratic management and political interference since private low-cost carriers have gained market share. Since its 2007 merger with Indian Airlines, a state-owned domestic carrier it has been suffering losses.
The new owner will take over 121 Air India planes and 25 Air India Express planes. Air India Express operates low-cost flights to more then 30 destinations in India and the Middle East.
