Tiger Airways Holdings has completed the transaction to acquire a 40% stake in Philippines-based carrier Southeast Asian Airlines (Seair).
The carrier paid $2.5 million for the shares, down from the earlier agreement of $7 million. The investment will be held through Tiger's wholly owned subsidiary Roar Aviation II.
"The purchase price of $7 million that was previously agreed upon with the seller has been reduced by liabilities determined in a due diligence review," says Tiger.
It will provide working capital under a five year tenure loan of up to $40 million to Seair.
The remaining 60% stake in Seair is held by Filipino shareholders.
The investment in Seair is the airline's second joint venture, after Indonesia's Mandala Airlines in January 2012. These acquisitions are in line with its strategy to expand and develop the carrier's business in the region.
"Together with our business partners in Philippines, our immediate focus will be on scaling up the business through network expansion, building a strong customer base, and establishing the airline's brand presence," says Tiger's group chief executive Koay Peng Yen.
In addition, Seair will adopt Tiger's business model, which includes the offering domestic and international destinations within a five-hour flying radius.
Since 31 July, Seair has launched domestic flights from Manila to Cebu, Davao, Tacloban, Iloilo, Puerto Princesa, Kalibo and Bacolod. It operates a fleet that consists of two Airbus A319 aircraft and three A320 aircraft.