SINGAPORE - Singapore's national carrier announced on Thursday (March 8) that it has entered into a non-binding deal with ground handler Sats and duty-free retailer DFASS (Singapore) to work on a joint-venture project in travel retail.
The trio will be offering inflight and ground-based duty-free and duty-paid goods, as well as mail order and pre-order services, Singapore Airlines (SIA) said in a filing with the Singapore Exchange.
The project is intended to be carried out through a joint-venture company, DFASS Sats, which is now owned equally by DFASS and Sats wholly owned subsidiary, Sats Asia-Pacific Star (APS).
Under the terms of a Points of Agreement, SIA will purchase 70 per cent of the issued share capital of DFASS Sats from DFASS and APS, SIA said.
Upon completion of the stake, both DFASS and APS will hold 15 per cent each of DFASS Sats.
DFASS Sats operates the KrisShop and Scootalogue retail programmes offered by airlines SIA, SilkAir and Scoot under a concession arrangement.
With the joint venture, SIA believes that it will be able to substantially grow its travel-related retail business and better satisfy the needs of its customers and KrisFlyer members, the airline said.
It said its investment in the proposed joint venture will be funded through its internal resources.
The proposed joint venture is not expected to have any material impact on the financial performance, net tangible assets per share and earnings per share of the company for the current financial year.
SIA shares closed flat at S$10.83, while Sats last traded at S$4.99 on Wednesday.