Sats unit signs multi-year, $325m inflight catering contract with Delta Air Lines

SINGAPORE - Mainboard-listed Sats Ltd announced on Wednesday that its 59.4 per cent-owned subsidiary in Japan, TFK Corporation, had on June 23 secured a multi-year inflight catering contract from Delta Air Lines.

The total contract value is estimated to be about 30 billion yen (approximately S$325 million).

TFK is expected to commence catering services to Delta at both Narita and Haneda Interna-tional Airports in Tokyo by October this year. Delta currently operates 22 peak-day flights from Narita and Haneda. The airline's owned and operated inflight kitchen in Narita will close following the transition to TFK.

Said Alex Hungate, President and chief executive officer of SATS: "We are delighted to welcome Delta back to TFK. This new agreement re-establishes our longstanding relationship of 22 years which had ended in 2009 following Delta's merger with Northwest Airlines."

A leading inflight caterer in Tokyo, TFK now serves more than 40 airlines including Japan Airlines, Singapore Airlines, Qantas, Lufthansa, Air France and major Chinese carriers.

The contract is not expected to have any material impact on Sats' net tangible assets per share and consolidated earnings per share for the current financial year.