Antitrust Law Daily Wrap Up, ACQUISITIONS & MERGERS NEWS: EC approves Navitaire, Amadeus airline software deal, (Jan 19, 2016)

By Greg Hammond, J.D.

The European Commission (EC) has approved Amadeus IT Group S.A.’s acquisition of airline software provider Navitaire LLC, concluding that the companies’ IT solutions target different types of airlines, the IT solutions are complimentary, and the transaction does not raise competition concerns.

Both Navitaire and Amadeus provide Passenger Service Systems (PSS)—an IT tool airlines use to manage reservations, inventory, and departure control, the EC announced. After the proposed transaction was disclosed, the EC investigated whether Amadeus could use its position in the Global Distribution System (GDS) market to disadvantage rivals or hinder innovation in the PSS market.

The EC first noted that Amadeus’ PSS is designed to meet the needs of full service carriers and Navitaire’s PSS is designed primarily for low cost carriers. Finding that the two companies’ products have varying degrees of complexity and functionalities that suit different types of customers, the EC concluded that Amadeus and Navitaire are not close competitors.

In addition, the EC determined that: (1) Amadeus is already in a position to bundle or tie PSS and GDS and that the company’s incentives to tie are unlikely to change as a result of the transaction; and (2) the transaction was unlikely to reduce innovation in the PSS market because Amadeus has a strong record of investing in its PSS software and would have every interest to invest in Navitaire’s PSS software.

Amadeus, based in Spain, focuses on providing GDS services and internal IT solutions—such as PSS—for airlines and airports. U.S.-based Navitaire LLC is a provider of IT solutions, including PSS, to airlines.

Companies: Amadeus IT Group S.A.; Navitaire LLC

News: AcquisitionsMergers Antitrust