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VÊ The new merged entity is likely to bring the airline among the world͛s top 20 carriers and the
largest airline in Asia. IA is somewhere 70.ÊAir India revenue wise is  th in the world Combined
we perhaps can get into the first 20͛s revenue wise. Air-India has

 employees and Indian
Airlines has over
00. The A-I and Indian Airlines merger will result in an Rs
000-crore
flagship carrier that will have a fleet strength of over
0 aircraft. The fleet size will exceed 200
planes as both airlines have already initiated the process to acquire over 100 Airbus and Boeing
planes between them during the next few years
VÊ International carriers has to have domestic support and through this merger the government
owned carriers will have one airline that operates both at the domestic as well as International
level
VÊ uain Rs 00 crore annually after the merger and the cost of the merger would be Rs
0-200
crore
VÊ ŒTRUCTURE: There will be only one CMD There will be separate business units and not
companies. The business units will comprise of one main passenger airline, one low costairline,
one engineering business, one handling business, one cargo business and so. A CEO will head
each unit with a presence on the Board Of Directors
VÊ At the end of the third year of merger it is expected that the combined airliner would have the
benefit of increased cost savings/profitability of Rs. 20 crore i.e. Rs. 
0 crore from revenue
synergies (primarily drivenby network integration) and Rs. 
0 crore from cost and capital
synergies (driven by consolidation and better negotiating power) as against integration cost of
Rs. 200 crore (HR rebranding & IT) some of which will be one-time cost. Hence the merger is
expected to enhance the profitability by over Rs. 00 crore per annum (i.e.  per cent of
current combined revenue)
VÊ Air India and Indian handle  and 2 of the ground-handling market in the country. The
merger would make them the single largest market player
VÊ In reply to a question in Rajya Œabha on the benefits of the merger of the two airlines, Praful
Patel stated the following benefits:
1.1.1.Ê(i) Provide an integrated international/ domestic footprint which will significantly enhance
customer proposition and allow easy entry into one of the three global airline alliances;
1.1.2.Ê(ii) Enable optimal utilization of existing resources through improvement in load factors
and yields on commonly serviced routes as well as deploy ͚freed up͛ aircraft capacity on
alternate routes;
1.1.3.Ê(iii) Provide an opportunity to fully leverage strong assets, capabilities and infrastructure
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1.1.4.Ê(iv) Potential to launch high growth & profitability businesses {Ground Handling Œervices
(GHŒ)}; Maintenance, Repair & Overhaul (MRO) etc.
1.1.5.Ê(v) Potentially enable merged entity to command better valuation;
1.1.6.Ê(vi) Operate a combined fleet strength, which will be largest in India and comparable to
other airlines in Asia/ Region; Rationalisation of routes
1.1.7.Ê(vii) Provides maximum flexibility to achieve financial and capital restructuring.
1.1.8.ÊAbove benefits leading to improvement in the prospects of the Company are expected to
translate into better prospects for all the employees.