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Virgin Australia is spending money: Carrier buys stake in Tiger and offers $102 million for Skywest

Oct 30, 2012 1:39 am

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The activity by Australian airlines and partners in Asia and the Middle East speak to the region’s growing importance to global flight patterns and tourism and business activity.

— Jason Clampet

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Virgin Australia, Australia’s second largest airline, has announced a 99 million Australian dollar ($102 million) takeover offer for regional carrier Skywest and said it bought a 60 percent stake in budget domestic rival Tiger Airways Australia for AU$35 million.

The Brisbane-based airline also announced on Tuesday that Singapore Airlines had bought a 10 percent stake in Virgin Australia for AU$105 million.

Virgin said its cash and scrip offer for Skywest, which operates in regional Australia and Southeast Asia, was worth AU46.88 cents per Skywest share.

Skywest executive chairman Jeff Chatfield said in a statement the offer, which is subject to regulatory and shareholder approvals, represented a substantial premium to the airline’s share price.

Virgin chief executive John Borghetti said he was pleased Singapore Airlines’ support as an investor.

Copyright (2012) Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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