Singapore Airlines takeover bid of Tigerair succeeds. Tigerair-Scoot merger may be next

Singapore Airlines (SIA) has increased its stake in Tigerair to above 90%, enabling the group to privatise the short haul low cost airline and fully integrate Tigerair into its portfolio. Taking over Tigerair boosts the outlook for the SIA group, particularly for medium/long haul low cost subsidiary Scoot.

Scoot is now in the black, having just reported its first ever quarterly profit. However, Scoot needs a more robust relationship with Tigerair as it doubles in size over the next few years.

Only approximately 5% of Scoot traffic now connects to Tigerair. SIA's takeover of Tigerair and Tigerair's upcoming transition to the Scoot reservation system will significantly boost transit traffic between the two LCCs, but ultimately a merger may be necessary for the synergies to be fully realised.