CCCS clears Alstom's proposed acquisition of Bombardier's train business

THE Competition and Consumer Commission of Singapore (CCCS) on Friday cleared the proposed acquisition of Bombardier Transportation (Investment) UK by French transport infrastructure company Alstom.

Following its assessment, CCCS concluded that the proposed transaction will not infringe the Competition Act. 

Alstom in February confirmed that talks were underway to buy Bombardier's train business in a deal that could be worth some US$7 billion, Reuters reported. 

In May, the CCCS called for public feedback on the proposed acquisition as part of its assessment of the deal.

Within Singapore, Alstom supplies signalling systems, railway vehicles including passenger carriages and infrastructure for the Republic's Mass Rapid Transit (MRT) lines, among other things.

Similarly, Bombardier supplies railway vehicles for MRT lines in Singapore, as well as signalling systems for certain Light Rapid Transit lines. 

In its application to Singapore's competition watchdog, Alstom noted that both parties overlap in the supply of railway vehicles and signalling systems in Singapore. 

Nonetheless, it said the proposed deal will not result in a substantial lessening of competition in Singapore as the Land Transport Authority of Singapore (LTA), which is the primary customer for these railway vehicles and signalling systems, will be able to exercise "significant bargaining power".

Alstom also said that barriers to entry of the industry are "not overly high", as there are no specific factors that would prevent new entrants, and that it will be difficult for competitors to collude post-transaction since there are a large number of global competitors that participate in open tenders called by the LTA.