Wednesday, June 29, 2005

Jetstar and Valueair consider merger

by Brian Turner

In airline news from Asia, Quantas Airways-supported Jetstar Asia and Singapore-based Valuair are holding discussion about a possible merger.

Valuair has been flying since May 2004 and has expanded traditional low-cost airline services by offering longer routes and serving basic meals.

Meanwhile, Singapore-based bargain air carrier Tiger Airways has announced just nine months after beginning operations that it is buying eight Airbus A320 aircraft, aiming to triple its fleet to 12 planes by 2007.

It will also add routes and staff as well as opening joint-venture franchises away from its Changi Airport base. The expansion, if made at regular prices, would cost in excess of $500 million.

Some analysts, however, believe that Tiger Airways will be able to secure a discount from Airbus. The chief executive of the airline, Tony Davis, said that the expansion will be financed from still-available start-up funds.

Singapore Airlines owns 49 percent of Tiger Airways, while Temasek Holdings owns 11 percent, the private investment firm of Tony Ryan, founder of RyanAir holds 16 percent, and a US businessman owns the other 24 percent.

Tiger Airways has said that its goal is to rival AirAsia, based in Malaysia.

 

 

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