Singapore Air To Take Stake In Virgin Australia
Virgin Australia, Australia's second-ranked airline, said alliance partner Singapore Airlines would buy a 10 percent stake in it for AUD$105 million (USD$108 million) to help it compete with larger rival Qantas.
Under the agreement, a placement of 245.6 million shares will be made to Singapore Airlines at an issue price of AUD$0.4288 per share.
In a broad move to consolidate its domestic position, Virgin separately agreed to acquire 60 percent of budget airline Tiger Australia for AUD$35 million.
The two will jointly invest a further AUD$62.5 million to increase Tiger's fleet size.
Virgin also said it would acquire 100 percent of regional airline Skywest, which services fly-in fly-out mining camps, for AUD$0.45 per share.
"The transactions announced today are in line with Virgin Australia's strategy to become the airline of choice in all markets, in order to diversify our earnings and drive growth opportunities for the business," said Virgin Australia chief executive John Borghetti.
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