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Singapore regulator okays Air India-Vistara merger

Competition watchdog approved deal after Air India, Singapore Airlines and Vistara agreed to address possible anti-competition concerns

Singapore regulator okays Air India-Vistara merger
[Source photo: Chetan Jha/Press Insider]

Singapore’s competition regulator has given its conditional approval for the proposed merger of Air India and Vistara, more than a year after the deal was announced by the Tata group.

As per the deal, which was announced in November 2022, Singapore Airlines will invest ₹2,059 crore (about $248 million) in Air India and will hold a 25.1% stake in the merged entity. 

Vistara is a 51:49 joint venture between Tata group and Singapore Airlines with international operations in the Middle East, Asia, and Europe besides a vast domestic network in India. 

The Competition and Consumer Commission of Singapore (CCCS) granted conditional nod after Air India, Singapore Airlines and Vistara accepted certain commitments to address possible anti-competition concerns.

The commitments pertain to scheduled air passenger transport services on Singapore-Delhi, Singapore-Mumbai, Singapore-Chennai, and Singapore-Tiruchirapalli routes where the companies will maintain capacity at pre-covid levels.

The parties have also committed to appoint an independent auditor to monitor compliance and submit a written annual report for each report year, and to submit an interim report which monitors their respective compliance with the committed capacity levels for every three weeks of non-fulfillment in a report year, CCCS said in a press release.

As per the deal agreement, Talace Pvt. Ltd, a Tata group unit created to bid for Air India, and Vistara will merge into Air India. 

The CCCS approval, granted on 5 March, is subject to the parties’ adherence to the proposed commitments, it said. 

The regulator said it conducted a market testing exercise from 8 December 2023 to 1 February 2024 on whether the proposed commitments would sufficiently address the competition concerns arising from the transactions.

After evaluating the feedback provided, CCCS said it considers the proposed commitments sufficient to address the competition concerns.

Earlier, in September, the Competition Commission of India (CCI) approved the deal, subject to certain conditions. Air India and Singapore Airlines assured CCI that they will ensure minimum capacity on various domestic and international routes, including Delhi-Sydney and Delhi-Paris.

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