22 January 2018
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CCS seeks views on SIA, CAE joint venture

Business Times
28 Dec 2017
Claire Huang

Singapore's competition watchdog is seeking feedback from Dec 27 to Jan 10, 2018 on the proposed joint venture between CAE International Holdings and Singapore Airlines (SIA) to set up, develop and operate a commercial flight training centre in Singapore.

The Competition Commission of Singapore on Wednesday said it received a notification on Dec 19 from the two parties for a decision about the proposed deal.

The Singapore-based centre, jointly controlled by CAE International and SIA, will offer type-rated, recurrent and conversion pilot training for certain Boeing aircraft.

The two companies said the centre will primarily support the training needs of SIA and its wholly owned airline subsidiaries in Singapore, as well as third-party airlines and other customers.

The commission said it is now assessing whether the proposed transaction will infringe section 54 of the Competition Act (Cap 50B), which prohibits mergers that have resulted, or may be expected to result, in a substantial lessening of competition within any market in Singapore.

In particular, CCS said the two parties identified aircraft pilot training services at a general level to be an area that overlaps.

"The market for the provision of aircraft pilot training services is highly competitive, given the multitude of suppliers including aircraft manufacturers, airlines and independent third parties; surmountable barriers to entry; low switching costs of customers; and the ability of customers to multi-source or self-supply," the commission noted.

CAE is registered and incorporated in Canada and is indirectly a wholly owned subsidiary of CAE Inc, which is listed on the Toronto and New York stock exchanges.

The CAE group designs, manufactures and supplies simulation equipment, provides training and develops integrated training solutions for defence and security markets, commercial airlines, business aircraft operators, helicopter operators, aircraft manufacturers and for healthcare education and service providers.

It also offers a range of flight training devices based on the same software used on its simulators, and operates a global network of training centres.

Source: Business Times © Singapore Press Holdings Ltd. Permission required for reproduction.