Major Tiger shareholder dumps 11.1 million shares
by Travis Teo
04:45 AM Jul 08, 2011

SINGAPORE - As troubled carrier Tiger Airways reiterated yesterday its long-term commitment to Australia, it revealed that one of its major shareholders has dumped about 11.1 million shares on the open market.

In a filing to the Singapore Exchange, Tiger said the transaction - which took place between June 27 and July 4 - reduced the stake held by United States fund manager Capital Group Companies to 5.93 per cent from 7.97 per cent.

Tiger said in a separate statement that it is optimistic about returning its Australian fleet to normal service. It added that it is committed to resolving its issues and it is confident of doing so in " the coming days and weeks" . The carrier was grounded by Australia's safety regulator on July 2. The flights were to resume tomorrow but the regulator has applied for a court order to extend the suspension to Aug 1.

When contacted, Singapore Airlines (SIA) said in a statement that it has no plans to reduce its 32.9 per cent stake in Tiger " at this point" . An SIA spokesman added: " Tiger is a separately listed entity ... We have no involvement in day-to-day management and that is not changing."

Following the suspension, Tiger implemented several top management changes, including the appointment of former Silkair chief executive Chin Yau Seng as acting CEO and SIA founding chairman J Y Pillay as non-executive chairman.

Standard & Poor's aviation analyst Shukor Yusof said: " The change in CEO indicates that SIA wants to have control over how this pans out. But what's important to note is that Mr Chin is a seasoned executive from SIA, he's a veteran. He also got the mandate from Singapore to help this out and with Mr Pillay also involved, I think it's a positive sign."

Apart from Tiger's problems in Australia, analysts noted that the fate of a joint venture between Tiger and Thai Airways hangs in the balance.

They said that the change of government in Thailand could result in leadership changes at Thai Airways, which is majority-owned by the government.

Aviation Week Asia editor Leithen Francis said: " We don't know whether the new Transport Minister is going to be pre-disposed to allowing Thai Tiger to start."

In response, Tiger told MediaCorp that the deal is still on the table and while there has been no discussions yet following the recent Thai election, meetings have been scheduled.



Source: TODAYonline
Publish date:08/07/11