Tata Sons, which holds a 51% stake in AirAsia India (Bengaluru International) and has, according to media reports, considered buying the remaining 49% of the venture from cash-strapped AirAsia Group, has reportedly snubbed an offer for the minority stake from New York-based, India-focused investment firm Interups.

Interups also offered to acquire Tata’s stake at the same valuation, and AirAsia Group, which is looking at exiting India, endorsed its offer, India’s Business Standard reported. But Tata Sons’ consent is necessary because both partners have the right of first refusal to each other’s stake.

“There was no response to the Interups proposal from the Tatas even though the offer was backed by AirAsia Berhad, which was getting around USD54 million by selling its stake in the Indian venture,” a legal source told the newspaper.

Interups, which is active mainly as an investment advisor for projects in India, has also looked at investing directly in AirAsia Group itself, the source alleged.

Tata Sons has had to invest additional money both in AirAsia India, as AirAsia Group cannot do so, and in Vistara (UK, Delhi International), which it runs in partnership with Singapore Airlines, so that both airlines can continue to operate.

In related news, AirAsia Group reiterated in a stock exchange filing on October 30 that the MYR300 million ringgit (USD72 million) loan it received from Sabah Development Bank was completed in accordance with all of Malaysia’s laws, policies, and procedures. The transaction took five months to complete from the time of the application, it said.

The Sabah state bank approved the loan, it elaborated, to boost the development of various projects in the eastern Malaysian region to create a significant positive socio-economic impact for the state as a whole.

“With the facilities, AirAsia’s contribution (currently at almost 1% of the state’s gross domestic product) is expected to double within the next ten years and help Sabah regain its position as a top tourism destination post-Covid-19,” the filing said.

The loan will, among other things, enable the group to accelerate its expansion plans to transform the Sabah state capital’s airport, Kota Kinabalu, into an international hub for AirAsia’s passenger and cargo operations. It pledged to develop facilities there that would increase the marketability of the state’s fresh seafood and farm produce domestically and internationally.

As previously reported, some politicians in Sabah have criticised the loan, urging the state’s government to stop it by arguing that is not in the state’s best interests to risk its limited funds to keep AirAsia running.