Skywest leads Virgin Australia regional expansion and into lucrative mining charter operations

The acquisition of West Australian regional carrier Skywest by Virgin Australia has cleared its final hurdle with High Court of the Republic of Singapore giving its blessing paving the way for Virgin Australia to increase competition to regional Australia and enter the resources charter market.

The Skywest transaction is part of three equity announcements made by Virgin Australia on 30-Oct-2012 that also included the acquisition of a 60% stake in low-cost carrier Tiger Australia and the sale of a 10% stake in Virgin Australia to codeshare partner Singapore Airlines.

Only the Tiger Australia transaction remains outstanding, with the ACCC extending its deliberations beyond the original Mar-2013 deadline and a decision now not expected until May-2013.

The deals are designed to allow Virgin Australia to compete better with Qantas on all domestic fronts by gaining access to the regional network and the fly-in-fly-out (FIFO) charter markets. In addition Tiger Australia provides a ready-made option to re-enter the LCC market that Virgin Australia evolved away from as the carrier moved up-market to compete with Qantas for the lucrative corporate and government markets.