Virgin Australia buys majority interest in Tiger Australia

[Andrew P]

my twitter account running hot on this deal

more to come, see ASX for announcement

[Bernie P]

VIRGIN Australia has bought a 60 per cent stake in low cost carrier Tiger Airways Australia for $35 million.

The deal will allow Tiger to expand its capacity in Australia and offer more attractive offers to customers, Tiger said.

Tiger and Virgin said they would spend up to $62.5 million on Tiger Australia to increase its fleet from 11 aircraft to 35 by 2018.

Tiger will continue to use the Tiger brand for at least another 20 years.

Tiger Airways chief executive Koay Peng Yen said the deal with Virgin was a significant step forward for the company.

"The joint venture will bring about a stronger and more competitive Tiger Australia, and allow us to deploy more capacity and attractive budget offerings to our customers," he said in a statement.

Virgin chief executive John Borghetti said the deal would give his airline greater access to the budget market.

"By partnering with Tiger Airways, we can use our expertise to leverage Tiger Australia's competitive cost base and build a sustainable budget carrier," he said in a statement.

Read more: http://www.news.com.au/business/brea...#ixzz2AjEwFLHA

[Chris W]

And Singapore buys 10% of Virgin.

[Jarden S]

So whats the ownership mix of Virgin Holdings now:
10% SIA
10% Etihad
20% ANZ
30% SRB or does he own more?
30% other investors

[Grahame Hutchison]

Singapore's 10% purchase gives Virgin Australia A$105.3mio to buy 60% of Tiger for only $A$35mio - nice deal.

[Thomas Collins]

The deal will allow Tiger to expand its capacity in Australia and offer more attractive offers to customers, Tiger said.

So Tiger's owners won't invest and grow the business because it is an under performer, but Virgin will...

So does this give Tiger Australia access to the International market now if approved?

[JamesL]

Yes.

[Thomas Collins]

It is all really quite straight-forward; Virgin's strategy isn't working, so they had to purchase a controlling stake in Tiger, and Tiger's business isn't successful, otherwise they would not need someone to take them over...

[Andi O]

Nothing is ever straight forward in the airline industry!