Tiger Australia to explore international operations

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Tiger Airways Australia will explore the possibility of starting international services as Virgin Australia becomes its new majority stakeholder.

"We will explore the possibility of Tiger Australia flying internationally, but the ultimate decision will have to be made by the new board of Tiger Australia," says a Tiger spokeswoman.

Under Australia's Air Navigation Act, only carriers with majority local ownership are allowed to operate internationally. Tiger Australia, which is still a wholly-owned subsidiary of Singapore's low-cost carrier Tiger Airways, operates domestic services from its Melbourne and Sydney bases.

There is, however, a hurdle that stands in its way.

If the proposed acquisition is approved, Virgin Australia Holdings (VAH) will hold the 60% stake in Tiger Australia. VAH, however, has more than 50% of foreign ownership. This means that the budget carrier would still have majority foreign ownership and would not be allowed to fly internationally unless some restructuring takes place.

Going forward, with Virgin to take a controlling stake in its Australian business, Tiger will focus on building its presence in Southeast Asia and strengthening the group's "competitive position".

The airline owns stakes in Philippine low-cost carrier Seair and Indonesia's Mandala Airlines.

"We will certainly also be working on turning Seair and Mandala around," adds the spokeswoman.