Singapore’s competition watchdog granted conditional approval on Tuesday for the merger between Air India, owned by Tata Group, and Vistara, a joint venture between Tata and Singapore Airlines.
The merger, announced in November 2022, aims to establish a dominant full-service airline in both domestic and international markets.
The Competition and Consumer Commission of Singapore (CCCS) expressed initial concerns regarding the merger, particularly focusing on the dominant market share the combined entity would hold on certain routes between Singapore and major Indian cities.
To address these concerns, the parties proposed maintaining flight capacity at pre-pandemic levels and appointing independent auditors to ensure compliance with these commitments.
“CCCS considers the proposed commitments sufficient to address the competition concerns arising from the transactions,” Reuters quoted the watchdog as saying.
The merger’s approval is contingent on various regulatory and foreign direct investment clearances, signalling the necessity for further authorisation before finalising the deal.
Singapore Airlines confirmed that it would be collaborating with Tata Sons to secure the remaining approvals from relevant authorities.
“Singapore Airlines continues to work with our partner Tata Sons to secure the remaining approvals from the relevant authorities to complete the merger,” stated a spokesperson for Singapore Airlines.
Details of the merger stipulate that Tata Group would hold a majority stake of 74.9 per cent in the combined entity, with Singapore Airlines retaining a 25.1 per cent ownership.
This arrangement solidifies Tata’s position as a major player in the Indian aviation industry, leveraging its partnership with Singapore Airlines to expand its market presence.
Air India refrained from immediate comment following the announcement of the conditional approval.
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