DOJ orders Signature to sell FBO
For Signature Flight Support to proceed with its planned acquisition of seven Hawker Beechcraft FBOs, the Department of Justice (DOJ) will require that Signature “divest assets used to provide flight support services at the Indianapolis International Airport.” Without the divestiture, the DOJ said, “the transaction, as originally proposed, would have combined the only two providers of flight support services to general aviation customers at Indianapolis International Airport and would have substantially lessened competition, resulting in higher prices and reduced service and innovation.”
Signature already owns an FBO at Indianapolis and must divest itself of either its existing FBO or the Hawker Beechcraft FBO. “This divestiture is necessary to preserve competition for general aviation customers at the Indianapolis International Airport,” said Thomas Barnett, assistant attorney general in charge of the DOJ’s antitrust division. According to DOJ documents, Signature’s FBO has 46 percent of the FBO services market at Indianapolis and Hawker Beechcraft 54 percent. Hawker Beechcraft’s total 2007 revenues from its seven FBOs were about $73 million, according to the DOJ, and the sale price of the seven FBOs is $128.5 million. Signature must complete the divestiture within 90 days of the July 3 DOJ proposed final judgment, and in the meantime the two FBOs must be kept completely independent.