Singapore Airlines Merger with Vistara Receives Conditional Approval from CCCS

Competition Concerns Addressed with Commitments to Maintain Route Capacity.

The Competition and Consumer Commission of Singapore (CCCS) has conditionally approved the merger of Vistara, which is 49% owned by Singapore Airlines (SIA), into SIA. Under the approved terms, SIA will retain a 25.1% stake in the merged entity, while Tata will hold the remaining stake.

Competition Concerns Addressed by CCCS

CCCS expressed concerns regarding competition in the transaction, particularly due to the significant number of flights operated by these airlines between Delhi, Mumbai, Chennai and Tiruchirappalli in India, and Singapore. Despite the presence of other competing airlines on these routes, CCCS found that the merging parties had maintained substantial market share in recent years. Additionally, CCCS identified potential price and capacity coordination issues arising from the merger that could restrict competition on the affected routes.

Commitments to Ensure Competition

To address these concerns, the airlines involved committed to maintaining capacity on the specified routes at pre-COVID-19 (2019) levels. They agreed to appoint an independent auditor to monitor compliance with this commitment and submit annual reports, with interim reports to be provided every three weeks in case of non-compliance.

Progress of Proposed Merger

SIA welcomed CCCS’s approval of the merger, noting that the proposed merger is progressing pending foreign direct investment and other regulatory approvals.

The merger of AI and Vistara, along with AI Express and the former AirAsia India, also requires approval from the National Company Law Tribunal (NCLT), which is expected to take approximately nine months.

Key Routes and Capacity Maintenance

The approved commitments specifically pertain to scheduled air passenger transport services on key routes such as Singapore-Mumbai (SIN-BOM), Singapore-Delhi (SIN-DEL), Singapore-Chennai (SIN-MAA), and Singapore-Tiruchirappalli (SIN-TRZ), with the parties pledging to maintain capacity on these routes at pre-pandemic levels (calendar year 2019).

A spokesperson for Singapore Airlines expressed appreciation for the approval and noted that the proposed merger is advancing, pending foreign direct investment and other regulatory approvals.