Singapore Airlines to buy remaining of Tiger Airways
06 Nov 2015
Singapore Airlines (SIA) has offered to buy the 43.49 per cent it does not already own in low-cost carrier Tiger Airways by offering to pay S$453 million ($322 million) as part of the Southeast Asia's biggest carrier's plan to strengthen its operations across its networks.
SIA, in which the country's sovereign wealth fund Temasek Holdings owns a majority 56.51 per cent stake, has offered to pay 41 Singapore cents for every Tiger share, a 32 per cent premium to Tiger Airways Thursday closing price of 31 Singapore cents.
Tiger Airways's shareholders also have the option of buying SIA shares at S$11.1043 apiece, a 0.4 per cent discount to Thursday's close.
''Tiger Airways' development potential is limited without deeper integration with the SIA Group to build a strong foundation for growth over the long term,'' said SIA CEO, Goh Choon Phong, in a statement. ''We believe our Offer to Tiger Airways shareholders is compelling as a significant premium is being offered.''
Tiger Airways is a budget airline operating services to regional destinations in Southeast Asia, China and India.
Founded as an independent airline in 2003, Tiger Airways was floated on the Singapore Stock Exchange and became a subsidiary of the SIA in 2014, which acquired a 56.51 per cent stake.
With a fleet of Airbus A320-family aircraft, Tiger Airways operates flights to 39 destinations across 12 countries in Asia.
SIA is the world's second largest airline by market capitalisation and flies to 61 destinations in 35 countries on six continents through its fleet of 104 Airbus and Boeing aircrafts.