Singapore Airlines which has 25.1 per cent stake in Air India will also be part of the consortium through its maintenance arm SIA Engineering Company Limited
Tata Group-backed Air India is reportedly in talks with German aircraft maintenance company Lufthansa Technik and Air France -KLM's engineering unit to bid for Air India Engineering Services Limited (AIESL) when it is put up for sale, The Economic Times reported citing people aware of the matter.
Singapore Airlines which has 25.1 per cent stake in Air India will also be part of the consortium through its maintenance arm SIA Engineering Company Limited.
AIESL, which was the engineering arm of Air India and owned by the government is the maintenance repair and operations (MRO) company that largely caters to Air India's fleet and its ownership is important for Air India to ensure smooth operation of its fleet, The Economic Times report added.
According to the people aware of the development Lufthansa CEO Carsten Spohr has had multiple meetings with top officers of Air India and Tata Sons to finalise the terms of consortium and deepen commercial ties with Air India.
A spokesperson for Lufthansa Technik told The Economic Times that the company is closely looking at privatisation of AIESL
"India is a highly dynamic growth market and extreme growth of air traffic will drive up the demand for MRO services. We are already present and successful on the Indian subcontinent with our own facility for component services and taking a very close look at this development, to participate even more strongly in this growth market," she told The Economic Times.
Tata Group acquired Air India from the government last year and as per the deal government retained the ownership of Air India's engineering and ground handling units.