Duty free operator DFS pulls out of Singapore over regulatory tighteningBusiness | 27 Aug 2019 12:02 pm
DFS Group is pulling out of the liquor and tobacco business at Singapore’s Changi Airport, with duty-free stores to close in June 2020 when the current lease expires and hundreds of staff expected to lose their jobs, the Straits Times reports.
Lotte and Shilla, South Korea’s two largest duty-free operators, bid for the rights, Yonhap reported, citing industry sources, Bloomberg reports.
Other bidders include industry giants from the U.S., Germany, China and northern Europe, Yonhap said, citing the sources.
The tender exercise closed yesterday and successful bidder is expected to be chosen around the end of this year or early next year, Yonhap said.
DFS Chairman and chief executive Ed Brennan blames regulatory changes on liquor, tobacco sales, as well as “geopolitical uncertainty,'' says staying at Changi “not a financially viable option.''
In this year’s budget released in February, the Singapore government said it will cut duty-free alcohol allowances to 2 liters from 3 liters.
“We are disappointed” that DFS has “opted not to participate in this tender but we will work closely with them to ensure a smooth transition to the new operator for the liquor and tobacco concession,” Changi Airport Group spokesman Ivan Tan said to the Straits Times.
DFS exit comes after nearly 40 years selling those products at Changi; Straits Times says it is the airport’s oldest and biggest tenant.