Air India is returning to its original owners after the Indian government announced on Friday it will sell its entire stake in the carrier to the Tata business conglomerate.
The Tata group will pay about 2.4 billion dollars for the airline it founded in 1932 and operated until it was nationalized in 1953. The deal is expected to be finalized by the end of the year.
Air India has struggled against the rise of low-cost carriers, accumulating debt of about 8 billion dollars.
The Tata group has been expanding its business. It already operates an aviation venture with Singapore Airlines.
Ratan Tata, emeritus chairman of the group's holding company Tata Sons, tweeted, "Welcome back, Air India!" He said it will take "considerable effort to rebuild Air India," but hoped the move will provide a "very strong market opportunity to the Tata group's presence in the aviation industry."
Air India's challenges include streamlining its workforce and upgrading services amid depressed travel demand due to the coronavirus pandemic.