Singapore Airlines (SIA) said it has finally managed to mop up more than 90% stake Tiger Airways, after extending the offer closing date multiple times, and also being forced to revise the offer price.
The city-state’s flagship carrier can now take the budget airline private.
SIA said it had received commitments for about 36.62 per cent of the total number of issued Tiger Airways shares, and this takes its holdings in the budget carrier to 93.77 per cent, allowing it to delist the latter.
The remaining Tiger shareholders have until 5.30pm on Feb 19 to accept SIA’s offer.
In November 2015, SIA has announced it plans to buy all the shares of Tiger Airways that it does not already own, with the aim of delisting and privatising the latter, in a deal that valued the budget carrier at about S$1.02 billion ($725.46 million).
At that time SIA already owned 55.8 per cent of the low-cost-carrier, and said it would offer S$0.41 per Tiger Airways share in cash, including an option to subscribe for SIA shares at S$11.10 per share.
In January this year, with minority shareholders of Tiger staying put, SIA was forced to hike the offer price by 10% to 45 Singapore Cents per share.
“As announced in the Level of acceptances announcement, as at 5.00 p.m. (Singapore time) on 5 February 2016, the offeror has received in aggregate valid acceptances of the offer in respect of 915,879,067 Shares, representing approximately 36.62 per cent. of the issued share capital of the Company which, when taken together with the shares owned, controlled or agreed to be acquired by the offeror….comprise an aggregate of 2,345,300,908 Shares, representing approximately 93.7 per cent. of the issued share capital of the company,” both SIA and Tiger Airwaves said in separate filings late Friday with the Singapore Exchange.
Tiger Airways had listed in the Singapore exchange at the beginning of 2010 at S$1.50, but its share price had crashed significantly since, and it had never breached the S$1 mark since 2011.
On Thursday, SIA, that is 56% owned by Singapore state fund Temasek, had announced that its third-quarter operating profit had nearly doubled to S$288 million ($205 million), up 96 percent from a year ago, while net profit rose 35.5 percent to S$275 million, largely on account of lower fuel costs.
“On the competitive front, expansion of other full-service airlines as well as low-cost carriers, particularly in Southeast Asia, will continue to exert pressure on loads and yields,” it had said in a statement, when announcing its results.