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VIRGIN Australia (ASX: VAH) is moving closer to its 60 per cent acquisition of Tiger Australia.
The Foreign Investment Review Board today announced it had no objection to the proposed $35 million deal.
The Australian Competition and Consumer Commission and Tiger Airways shareholders have previously given the deal the go ahead, but Virgin says the deal is still subject to conditions which will delay the completion of the purchase until mid-July.
VAH took on the Tiger deal in an effort to compete with Qantas in the budget air travel segment.
“This confirmation satisfies another condition for the proposed acquisition of Tiger Australia, which will enable Virgin Australia to access the budget market segment and expedite the growth of Tiger Australia,” says the company in a statement today.
Tiger Airways and Virgin Australia have committed to invest up to a further AUD62.5 million collectively into the business to fund growth in Tiger Australia. The joint venture has flexibility to grow Tiger Australia’s fleet from 11 to up to 35 aircraft by 2018.
VAH has also taken 100 per cent control of Skywest Airlines in a further effort to compete with Qantas on regional air routes.
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