Virgin Australia gains Tiger Australia to complete the domestic set

Virgin Australia has been granted approval to buy a 60% stake in LCC Tiger Australia by the Australian Competition and Consumer Commission (ACCC) and in so doing puts in place the final piece of a puzzle that allows Virgin Australia to compete against the Qantas Group on a level footing.

The ACCC agonised over the ground-shifting decision with concerns that returning the Australian market to a duopoly would remove the benefits that Tiger Australia had brought as a third competitor when it launched in Nov-2007. The commission delayed its decision by nearly six weeks while it sought more information from Virgin Australia and Tiger Australia to provide the comfort it needed.

Ultimately ACCC chairman Rod Sims concluded that "this acquisition is unlikely to lead to a substantial lessening of competition in the Australian market for domestic air passenger transport services".

Virgin Australia chief executive John Borghetti said: "By partnering with Tiger Airways, we can use our local expertise to build a sustainable budget carrier, which will offer great value airfares and benefit jobs and tourism in Australia."