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PART 5
INFORMATION FOR THE CCS PUBLIC REGISTER
(TO BE COMPLETED BY THE APPLICANT(S))
Please provide a comprehensive, non-confidential summary of the merger including at least the following information:
(i) the names of the merger parties;
(ii) a description of the transaction;
(iii) a description of the business activities of the merger parties worldwide and in Singapore;
(iv) a description of the overlapping goods or services, including brand names;
(v) the applicant’s views on:
a. definition of the relevant market(s);
b. the way in which competition functions in this market;
c. barriers to entry and countervailing buyer power; and
d. the competitive effects of the merger (non-coordinated, coordinated and/or vertical effects, as relevant).
This Form M1 application for decision (“Application”) under section 57 of the Competition Act (Cap. 50B) (“Competition Act”) relates to the proposed joint venture between Airbus Services Asia Pacific Pte. Ltd. ("Airbus Asia"), a wholly-owned subsidiary of Airbus Group N.V., and Singapore Airlines Limited (“SIA”) for the provision of pilot training services in the Asia-Pacific region pursuant to the Joint Venture Agreement between Airbus Asia and SIA dated 13 August 2014.
Airbus Asia is a wholly-owned subsidiary of Airbus Invest S.A.S, itself a wholly-owned subsidiary of Airbus S.A.S (“Airbus”), a Société par Actions Simplifiée incorporated under the laws of France. Airbus is a wholly-owned subsidiary of Airbus Group N.V., a public company with limited liability incorporated under the laws of the Netherlands. The Airbus Group is active in research, design, development, manufacture, modification, integration, testing, marketing, sale, supply, servicing and support of commercial aircrafts, telecommunications equipment, civil and military helicopters, space vehicles, guided weapons and drones, amongst others.
SIA is a company incorporated in Singapore since January 1972 and listed on the Singapore Exchange Securities Trading Limited. SIA is a provider of aviation services. It notably provides: (a) passenger and air cargo transportation services; (b) aircraft engineering and maintenance services; (c) training services; and (d) air charters, tour wholesaling and related activities.
The joint venture company, Airbus Asia Training Centre Pte. Ltd. (“AATC”), was incorporated on 3 September 2014 in Singapore as a 100 per cent subsidiary of Airbus Asia. Upon completion, Airbus Asia will hold 55 per cent of the total issued shares in AATC and SIA will hold 45 per cent of the total issued shares in AATC.
In respect of the relevant market(s), the merger parties’ (“Parties”) view is that the relevant market is the market for flight pilot training for all of the following aircraft: Airbus A320 family, A330 family, A340, A350XWB and A380 aircraft types and, possibly, for other types of Airbus aircraft. Where, however, the market should be further segmented, the market for the provision of pilot training services may be segmented by type of training, type of aircraft, between contractual and additional training and between captive and merchant training. With regard to geographical scope, it is the Parties’ view that the market is likely to be worldwide or at least regional in scope.
The market for the provision of pilot training services is very competitive and pilot training services providers compete notably on price and quality of their services.
Barriers to entry are low as airlines and independent third parties (e.g., full-flight simulator manufacturers) are able to obtain from the aircraft manufacturer all data required to set-up their training.
Competition is intense in the simulator market and simulator manufacturers offer different financing schemes (operating lease, finance lease or direct purchase) which tend to ease access to equipment.
With the low combined market shares of the Parties in the relevant market(s), the competitiveness of the pilot training services market and the availability of a multitude of alternative sources of supply in the market, the Parties’ view is that the merger would not lead to a substantial lessening of competition in any market in Singapore.
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