News analysis Lessons in resilience, future-proofing from Sats' efforts to diversify

In the wake of the pandemic, moves to globalise and diversify its business are continuing

- Mike Yeo

Correspondent The continued efforts by in-flight caterer and ground handler Sats to globalise and diversify its business in the wake of the Covid-19 pandemic is a salutary lesson on how companies can improve the resilience of their operations to future-proof themselves against shocks.

And its recent tie-up with Japanese conglomerate Mitsui, as it seeks to transfer its know-how and experience in preparing ready-to-eat meals for the air travel industry to the retail industry, is a natural progression for the company.

At the same time, it is also expanding its air cargo handling business, the other key component of the services it provides, with the acquisition of a rival ground handler's operations in the Netherlands.

Sats was established in 1972 as a wholly owned subsidiary of Singapore Airlines, and later became a separate entity in 2009.

With its acquisition of Worldwide Flight Services (WFS) in 2023, the Singapore firm is now one of the largest players in the airport ground handling services industry in the world - its network spans 215 locations in 27 countries.

Sats announced a strategic partnership with Mitsui on Aug 23 to expand its presence in Japan, which will see the Japanese conglomerate take a 15 per cent stake in Sats Food Solutions India, Sats Food Solutions Thailand, Sats Tianjin in China, and Sats subsidiary Country Foods, a meat distributor and processor, with an investment of $36.4 million.

The partnership will also enable Sats to lean on Mitsui's extensive network of food retailers, manufacturers and food and beverage players across key markets in Asia, including Japan.