CCCS consults on SATS proposed acquisition of Worldwide Flight Services

THE Competition and Consumer Commission of Singapore (CCCS) is seeking public feedback on the proposed acquisition of Worldwide Flight Services (WFS) by SATS.

In a statement on Monday (Nov 7), CCCS said it accepted an application from SATS, and the entity that is selling WFS, for a decision on the proposed transaction.

The competition watchdog is assessing whether the proposed transaction would infringe section 54 of the Competition Act, which prohibits mergers that have resulted, or may be expected to result, in a substantial lessening of competition within any market in Singapore.

In September this year, SATS announced the proposed acquisition of WFS, the world's largest air cargo handling firm, "to create a global leader in the aviation services sector".

The proposed acquisition of WFS from an affiliate of investment firm Cerberus Capital Management would be for a cash consideration of around 1.2 billion euros (S$1.7 billion).

WFS is based in Paris, France, and primarily provides cargo handling services, ground handling services, passenger and premium lounge services, as well as other freight-related services. In Singapore, WFS operates under the brand name JetQuay and manages the JetQuay CIP Terminal, a separate private terminal at Changi Airport.

Both SATS and the seller of WFS have said that the proposed transaction will not result in a substantial lessening of competition in Singapore, as there is no overlap of ground handling services, given that WFS does not provide any ground handling services in the country.

The parties noted that there is "no competitive overlap in the provision of premium passenger services in Singapore", and said that customers such as airlines or credit card companies would also be able to switch and self-supply premium passenger services such as lounges.

SATS shares have fallen more than 30 per cent from the closing price of S$3.87 on Sep 27, before the proposed acquisition was announced. The counter closed at S$2.70 on Monday, up 1.1 per cent or S$0.03, before the CCCS announcement.

CCCS is inviting public feedback until Nov 18, 5 pm, and more information on the public consultation can be found on the CCCS website.



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