Cebu Pacific acquires Tigerair Philippines-A A +A
Wednesday, January 8, 2014
MANILA -- Cebu Air Inc., the operator of budget airline Cebu Pacific, is acquiring 100-percent ownership of the Philippine unit of Singapore-based Tiger Airways Holdings Ltd and 40 percent of its parent firm, for $15 million.
In a statement published on websites of both airlines Wednesday, Tigerair CEO Koay Peng Yen and Cebu Pacific CEO Lance Gokongwei said the "strategic alliance" will allow both parties to collaborate in international and domestic air routes "creating the biggest network of flights" in the Philippines.
"By combining their resources, Cebu Pacific will be able to provide services to high growth markets including Australia and India. Tigerair will be able to fly more passengers to additional cities in Cebu Pacific’s extensive network in the Philippines and North Asia. This arrangement will allow both airlines to deploy capital more efficiently," the statement read.
Tigerair Philippines currently operates an average of 118 flights per week with five aircraft to 11 domestic and international destinations, from its bases in Manila and Clark.
Cebu Pacific meanwhile operates an average of 2,200 flights per week with 48 aircraft to 24 international and 33 Philippine cities.
"Tigerair and Cebu Pacific share a vision for both airlines to join forces and create the largest budget airline network between Asia and the Philippines. This partnership with Cebu Pacific is consistent with our asset-light strategy, and builds upon our other alliances," Koay Peng Yen said.
"This strategic alliance will allow both Cebu Pacific and Tigerair to leverage our extensive networks spanning from North Asia, ASEAN, Australia, India, all the way to the Middle East. Our customers can expect an even wider range of travel options, and seamless travel connections while enjoying our trademark low fares," Gokongwei said.
The Centre for Asia-Pacific Aviation (CAPA) earlier said that a Cebu Pacific-Tigerair partnership will put Cebu Pacific ahead of the Philippine Airlines group in the share of flight slots in Manila.
"Acquiring the Tigerair Philippines slots is significant as it would grow Cebu Pacific’s share of scheduled commercial aircraft slots at Manila to about 38 percent, putting it ahead of PAL Group’s 35 percent share (includes PAL mainline and regional carrier PAL Express," the CAPA said.
"Cebu Pacific could use the additional slots to expand its already leading share of the domestic market or support further international expansion, where it is still smaller than PAL," it added.
Tigerair Philippines currently holds a four-percent share of slots in Manila, fourth only to the PAL Group, Cebu Pacific, and Zest AirAsia. (Sunnex)