The merger of Air India (erstwhile) and Indian Airlines was approved by the Government on 1 March, 2007 and a new company vis. National Aviation Company of India Limited (NACIL) was incorporated on 30 March, 2007 with the brand name of 'Air India'. The merger of two airlines was envisaged to provide following benefits:

• Provide an integrated international/domestic footprint which will significantly enhance customer proposition and allow easy entry into one of the three global airline alliances;

• Enable optimal utilization of existing resources through improvement in load factors and yields on commonly services routes as well as deploy 'freed up' aircraft capacity on alternate routes;

• Provide an opportunity to fully leverage strong assets, capabilities and infrastructure;

• Potential to launch high growth & profitability businesses (Ground Handling Services (GHS);

• Maintenance, Repair & Overhaul (MRO) etc;

• Potentially enable merged entity to command better valuation;

• Operate a combined fleet strength which will be largest in India and comparable to other airlines in Asia/Region;

• Provides maximum flexibility to achieve financial and capital restructuring. Above benefits leading to improvement in the prospects of the Company are expected to translate into better prospects for all the employees. #