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Singapore's competition watchdog on Tuesday said it has approved the merger between Tata Group-owned Air India and sister airline Vistara, a joint venture between Tata and Singapore Airlines, subject to certain conditions.
Singapore's flagship carrier announced its plans to merge Vistara and Air India in November 2022 to create a leading full-service airline in the domestic and international markets.
While India's antitrust body had approved the deal in September last year, the Competition and Consumer Commission of Singapore (CCCS) had identified some competition concerns regarding the merger.
The parties have the majority market share among airlines operating direct flights on the concern's four routes between Singapore and the Indian cities of New Delhi, Mumbai, Chennai and Tiruchirappalli, the watchdog said.
To address the concerns raised by the watchdog, the Parties agreed to maintain capacity on the said flights at pre-COVID levels, appoint independent auditors to monitor compliance with capacity commitments, and undertake annual as well as interim It is proposed to submit the report.
“The CCCS considers the proposed commitments adequate to address competition concerns arising from the transaction,” the watchdog said on Tuesday.
The proposed merger is awaiting other regulatory and foreign direct investment approvals.
“Singapore Airlines continues to work with our partner Tata Sons to obtain the remaining approvals from the relevant authorities to complete the merger,” a Singapore Airlines spokesperson said.
Air India did not immediately respond to a Reuters request for comment.
As per the terms of the deal, auto-to-steel conglomerate Tata will own 74.9% of the combined entity, while Singapore Airlines will hold the remaining 25.1%.