Singapore Airlines acquires stake in Virgin Australia
SINGAPORE Airlines will acquire a 10% stake in Virgin Australia for $105.3 million.
The strategic stake will be acquired through a placement of new shares by Virgin Australia Holdings. Singapore Airlines will purchase 245.57 million shares at 42.88 Australian cents per share.
Australian Foreign Investment Review Board (FIRB) approval has been obtained for the share purchase, which is expected to be completed on November 16.
"This major development demonstrates the importance and strength of the partnership between our two airlines, and our shared commitment to an alliance that provides a wide range of consumer benefits," Singapore Airlines CEO Goh Choon Phong said.
"Singapore Airlines fully supports the ongoing transformation at Virgin Australia, which has already resulted in a more competitive aviation market in Australia. With this investment, there is no doubt that Singapore Airlines and Virgin Australia intend to remain alliance partners for the long haul."
Virgin Australia CEO John Borghetti said: "Singapore Airlines is an important alliance partner of Virgin Australia and we are very pleased to have their support as an investor. This investment leaves Virgin Australia with a strong and flexible balance sheet to fund growth."
Singapore Airlines and Virgin Australia entered into a long-term partnership last year, encompassing codesharing, reciprocal frequent-flyer programme benefits and lounge access, co-ordinated schedules on flight connections and joint sales, marketing and distribution activities.
