Cebu Pacific acquires Tigerair Philippines for $15M

MANILA, Philippines - Cebu Pacific chief executive Lance Gokongwei announced on Wednesday that the budget carrier has purchased 40 percent of Tiger Airways' stake in Tigerair Philippines.

"As part of the strategic alliance, Cebu Pacific will acquire 100-percent ownership of Tigerair Philippines, including the 40-percent stake of Tigerair," the Philippine-based firm said in a statement.

Together, Cebu Pacific and Tiger Air have formed Asia's largest budget airline network out of Philippines.

"This strategic alliance will allow both Cebu Pacific and Tigerair to leverage on 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.

Tiger Air's remaining 60 percent, meanwhile, is held by Singaporean stockholders.

Gokongwei said that the alliance covers a joint operation of the Philippines-Singapore route subject to regulatory approval.

Tigerair Group chief executive officer Koay Peng Yen, meanwhile, said that the new team up allows the company to reduce operational costs.

"This partnership with Cebu Pacific is consistent with our asset-light strategy, and builds upon our other alliances," Koay said.

Branding

Cebu Pacific said that each carrier will retain its own branding while communicating that both are partners.

Tigerair Philippines, meanwhile, will only continue to operate under the Tigerair brand at the outset.

"Both Tigerair and Cebu Pacific websites will be used as sales and distribution platforms to market all routes operated by both airlines. The carriers also expect to collaborate on other common destinations in Asia," the statement reads.

Tigerair Philippines currently operates an average of 118 flights per week with five aircraft to 11 domestic and international destinations from airports in Manila and Clark, Pampanga.

Cebu Pacific's 48 aircraft make an average of 2,200 flights per week to 24 international and 33 local cities in its network.