Tiger Airways to delist as SIA raises stake over 90%

Singapore - Singapore Airlines (SIA) has boosted its stake in Tiger Airways to over 93 per cent, which will enable it to successfully delist the budget carrier.

In a release to the Singapore Exchange (SGX) on Friday night, Tiger said that SIA and concert parties held 93.77 per cent in the low-cost carrier as at 5pm on Feb 5, having garnered valid acceptances of about 36.62 per cent.

This comes after SIA launched a take-over bid in November last year to delist and privatise the low-cost carrier as the group pushes for closer integration across its four airlines.

SIA initially made an offer of 41 Singapore cents per share but was forced to raise it to 45 cents after Tiger's long-term minority shareholders expressed their dissatisfaction with the deal.

"Tiger Airways shareholders who have not yet accepted the offer are still able to tender their acceptances up to the closing date," said SIA in a press release. The offer closes at 5.30pm on Feb 19.

Not accepting the offer at this point could leave shareholders stuck holding stock in an unlisted company, making it tougher to exit.

Once the offer closes, SGX will suspend trading in Tiger's shares as the free float has fallen below the minimum ten per cent threshold.

The offer was initially due to close on Dec 28 last year but the Securities Investors Association (Singapore) (SIAS) came forward, on behalf of Tiger's minority shareholders, and urged SIA to consider revising its offer. SIAS chief David Gerald pointed out that Tiger shareholders who came in at the initial public offering price of S$1.50 in 2010 and subscribed to all three rights issues since would have paid an average of S$0.67 a share.

SIA's final offer of 45 cents represents a premium of 45 per cent over Tiger's last traded price of 31 cents on Nov 5.

SIA believes that integrating Tiger fully within the SIA group will put the struggling budget carrier in a better position for future growth amid a challenging operating environment.

Shares in SIA closed at S$11.24, up 42 cents, while the Tiger counter ended trading at 46 cents, or half a cent higher.

This article was first published on February 6, 2016.
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