Virgin Australia comes full circle with the acquisitions of Tiger Australia and SkyWest
In a ground shifting move for the Australian domestic market Virgin Australia announced on 30-Oct-2012 three equity deals in one day that will see the carrier come full circle with the acquisition of a 60% stake in low-cost carrier Tiger Australia and 100% of regional operator Skywest. The two acquisitions will be funded through capital raised by selling a 10% stake in Virgin Holdings to the Singapore Airlines (SIA) Group.
The transactions, if approved by regulators, mean Virgin Australia will be able to better compete with Qantas on all domestic fronts. The transactions also breathes new life into Tiger Australia, which has been unprofitable since it was established in 2007 and particularly since it was grounded for five weeks in 2011 by Australia's safety regulator. With Virgin Australia now in control, Tiger Australia expects to expand its fleet from 11 A320s to 35 A320s over the next five years, giving it the aircraft needed to add more domestic bases and possibly launch regional international services.
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