VA to take full control of TT for just $1

Media outlets report Virgin Australia CEO John Borghetti is set to take up the remaining 40% stake in low cost carrier TigerAir Australia for the princely sum of just $1.

Taking full ownership of TigerAir Australia has always been part of the Virgin Australia strategy as part of their 'Virgin Vision 2017' plan.

Borghetti is quoted as saying he intends to have the struggling carrier back in profitability ahead of schedule before the end of 2016, by leveraging the resources of the wider Virgin Australia group.

So what exactly does $1 get Virgin?  Obviously 40% of remaining shares, but also a fleet of 13 A320 aircraft, obvious current debt, the rights to operate the TigerAir Australia in Australia, but also the rights to operate the brand on a number of short haul international routes from Australia.

This international expansion would likely see TigerAir competing against Jetstar on routes to Bali and other south east Asian locations and may open up the opportunity for TigerAir to enter slim Trans Tasman routes, especially those that have previously been flown and dropped by the major carriers.

The transaction is expected to be completed by the end of the year pending permission from regulatory authorities and shareholders.

You can read more on the plan via Australian Business traveller or The Australian

Tigerair ups BNE

Tigerair have announced they will open a new base at Brisbane Airport as well as introducing flight from Brisbane to Adelaide, Cairns and Darwin.

The new Adelaide service will launch in March while the Cairns and Darwin services are scheduled to commence in April.

All three flights currently look like a single daily services 
BNE-ADL TT313 15:50-19:10           ADL-BNE TT318 20:30-22:20
BNE-CNS TT486 12:25-14:45           CNS-BNE TT491 15:15-17:20
BNE-DRW TT652 20:45-00:25*         DRW-BNE TT655 01:00-05:10

Virgin now 60% owner of TT

  

Virgin Australia has now completed its 60% acquisition of Tigerair which was first announced in October last year.

The deal, which was announced on October 30 last year, will see Virgin Australia CEO John Borghetti become chairman of Tigerair to lead the low-cost carrier’s revitalisation.

The aim is to grow Tigerair to become a sustainable and respected budget carrier within Australia.  It is still not confirmed what the final fleet size will be as when the take over was announced Borghetti said the fleet would grow to 35 aircraft by 2018, but in later statements said this may not in fact be the case.

Read more on the competed acquisition via Australian Aviation HERE

Tiger rebrands

With it's controlling interests soon to be Virgin Australia, Tiger has undergone a rebranding, now being know as TigerAir

Australian Aviation: (James Morgan)

The name change and dropping the leaping Tiger logo for large ‘Tigerair’ titles promises to be the first step in the airline’s rebranding and repositioning as it comes under Virgin Australia control and seeks to move on from the brand damage caused by its 2011 grounding, turn around heavy financial losses, and grow to become a more aggressive competitor to Jetstar in the Australian low cost airline market.

CEO Rob Sharp says this is just the first step in the process for the new TigerAir

Read more at Australian Aviation HERE 

Big changes in the land of Aus

Virgin Australia have today announced 3 big changes to the face of domestic aviation in Australia, which are set to firmly cement Virgin Australia as a heavy weight in the Australian industry.

Virgin have announced that they have purchased a 60% controlling stake in Tiger Airways, which will see Virgin & Singapore Airlines run basically a joint venture operation, to target Jetstar head on.  The stake believed to be worth $35 million will then see Virgin invest up to $62.5 million to improve the Tiger brand and see its fleet grow from the current 11 Airbus A320's to a fleet of 35 aircraft by 2018.

The Tiger brand won't be going away, however – it will remain "for at least another 20 years."

Tiger Airways Australia said in a statement that the airline will remain low cost with an internet based distribution platform.

Read more by John Walton (@thatjohn) at austbt.com.au HERE

Virgin have also announced that they will purchase regional partner Skywest.  This is likely to see Skywest operating for Virgin the same way QantasLink does for Qantas, Virgin branded but running its own airline.

Skywest already operate like this on the east coast of Australia,  operating the Virgin Australia fleet of ATR aircraft.

Virgin Australia CEO John Borghetti said today that the deal "will enable us to fast-track our advancement in the high growth fly-in-fly out and regional markets, increasing competition in these important segments.

The deal relies on approval from Australian & Singaporean regulators as well as approval from Skywest shareholders.

Read more from John Walton at austbt.com.au HERE

Singapore Airlines will take a $105 million, 10% stake in Virgin Australia.

Virgin and SQ already operate a partnership with sharing of flights, frequent flyer schemes and reciprocal access to lounges, and Virgin Australia today bought a 60 percent controlling interest in Singapore Airlines' subsidiary Tiger Airways Australia.

This investment puts Singapore on an even footing with Etihad who also own 10% of the airline, while Air New Zealand own 19.9% & Sir Richard Branson owns 26%

Read more from David Flynn (@djsflynn) at ausbt.com.au HERE

Tiger still losing money.

Tiger are still struggling to turn a profit releasing a $21M AUD loss in the three months to June 30th.  Tiger is still recovering from the CASA grounding last year, and are fighting competition on main routes from Qantas, Virgin Australia and Jetstar.

''We may see a delay in profitability, but our competitors are going to feel it as well,'' he said yesterday.
AdvertisementBy October, Tiger plans to be operating the same number of flights - 64 sectors a day - it had before the air-safety regulator grounded it for six weeks last year. The airline is still waiting for the Civil Aviation Safety Authority to respond to its request to have all flight restrictions removed.
Tiger's return to full service will add to the glut of flights in the domestic market. The routes to have the biggest increases in seat capacity include the country's busiest, between Sydney and Melbourne (up 18 per cent year on year), and Melbourne-Hobart (up 70 per cent).

Its suffice to say if it wasn't for the deep pockets of Tiger's parent company, then this airline, like previous competitors, would not be able to survive on its own in the current economic conditions.

Read more about the trials Tiger are facing via brisbanetimes.com.au HERE

Tiger still waiting

Australian Low Cost Carrier Tiger Airways remains grounded with CASA now requiring changes to documentation to bring it up to standard.

CASA spokesman Peter Gibson said last night that the regulator had identified deficiencies in some of Tiger's documentation.
"These need to be addressed by Tiger and resubmitted for review before CASA can complete its assessment. This will necessarily take some more time," Mr Gibson said. "Progress is essentially dependent on Tiger providing complete, correct and up-to-date documentation to CASA."

CASA has now kept Tiger grounded since the beginning of July.

Read the full report from Steve Creedy of theaustralian.com.au HERE
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Tiger have also reported that their financial report for the year ending March 2011 will be significantly effected by both fuel prices and the grounding of the Australian operation

It said the Australian operations were likely to report a net loss for the financial year ending March.

Read more from news.airwise.com HERE