PNG's ICCC declines LINK PNG's bid to acquire shares in PNG Air

 The Independent Consumer and Competition Commission (ICCC) has declined Link PNG’s application to acquire shares in PNG Air Ltd for the second time now.

Link PNG, a subsidiary of Air Niugini, had applied to acquire 40% shares owned by the National Superannuation Fund (NSF) and 9% share from other shareholders in PNG Air Ltd.

Upon submitting its application, Link PNG claimed that PNG Air was not profitable, and with the covid-19 impacting the aviation industry PNG Air would likely exit the market.

Link PNG stated that it was important that their proposed share acquisition be approved to maintain current service levels, competition and to protect the employment of current employees of PNG Air.

The consumer and Competition watchdog announced last week that upon completing its assessment of the proposed acquisition, the transaction was likely to have an effect of greatly decreasing competition in the relevant markets.

ICCC found that the acquisition would lead to potential public disadvantages that would be greater than the benefits.

ICCC Commissioner Paulus Ain said the watchdog noted that PNG Air was increasing its market shares and its revenues are continuously increasing.

“There was no evidence of any significant rationalization or restructure carried out by PNG Air Ltd Air to suggest that such measures have already been exhausted, such as continued losses are a sign of a failing firm,” said Ain.

Ain said there has not been any cost-cutting in PNG Air in 2019 and that 2020 figures have tripled from 2017 and 2018.

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