The merger deal between Air India and Vistara, a joint venture between Tata Group and Singapore Airlines, has received conditional approval from Singapore’s competition watchdog.
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The Competition and Consumer Commission of Singapore’s approval comes 15 months after Singapore’s flagship carrier announced its plan to merge Vistara and Air India in November 2022. The brand was announced to create a bigger full-service airline in domestic and international skies.
The Competition and Consumer Commission of Singapore has identified certain competition concerns in assessing the various transactions regarding the merger.
The watchdog noted that the parties possess the majority of market shares among airlines operating direct flights on four routes of concern — that is between Singapore and Indian cities of New Delhi, Mumbai, Chennai and Tiruchirapalli, Reuters reported on Tuesday.
The watchdog said the respective parties have submitted their proposals to avoid the competition issues which it finds sufficient to address the concerns.
In September last year, the Competition Commission of India (CCI) had given its nod for Vistara’s merger with Air India.
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“CCI approves the merger of Tata SIA Airlines into Air India, and acquisition of certain shareholding by Singapore Airlines (SIA) in Air India subject to compliance of voluntary commitments offered by the parties,” the Competition Commission of India said in a statement.
Tatas re-entered into the Indian airline market in 2013 with Vistara & AirAsia India. Founded in 2015, Vistara is a joint venture (JV) between Tata Group and Singapore Airlines.
In January 2022, the Tata Group also acquired Air India and Air India Express.
Later in 2022, the Tata Group said it would merge Vistara with Air India and Air Asia India with Air India Express to eventually have one full-service carrier Air India and one low-cost Carrier Air India Express.
In November 2022, the Tata Group and SIA said that the latter would dilute its stake in Vistara.
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As part of the merger transaction, Singapore Airlines (SIA), which currently holds 49 per cent in Vistara, will invest Rs 2,059 crore to get 25.1 per cent in the merged Air India. The companies had then said that the consolidation of Vistara with Air India by March 2024.
