SINGAPORE - Singapore Airlines (SIA) responded on Monday (Dec 21) to a call for it to improve its buyout offer for Tiger Airways, reiterating that its offer was "fair" and "compelling", and that market analysts have also recommended that shareholders accept it.
"Singapore Airlines reiterates that it believes the offer is compelling, with the offer price representing premiums of between 32 per cent and 42 per cent over the last traded price; and the one-month and three-month volume weighted average prices of Tiger Airways shares preceding the announcement of the offer," SIA said in a filing with the Singapore Exchange.
Citing a report from the independent financial adviser, SIA added that the offer price also represents a premium of 42.6 per cent over the average share price target estimates of research brokers on Nov 5, the day before the offer was announced.
Last Friday, the Securities Investors Association Singapore (Sias) issued an open letter to SIA, on behalf of Tiger Airways' long-term minority investors, "to put forward their case for a revised offer". Sias also asked for the deadline accepting the offer to be extended from Dec 28 to Jan 11 in the view of the year-end holidays.
SIA, which already owns 55.8 per cent of Tiger Airways, made a S$453 million takeover offer for the rest of the airline on Nov 6. It aims to delist and privatise the budget carrier to fully integrate it within the SIA group.
It said in its filing that the independent financial adviser appointed by Tiger Airways to evaluate the offer noted that the financial terms of the offer "are, on balance, fair and reasonable".
Maybank Kim Eng Securities was appointed as the independent financial adviser for the general offer.
SIA added that Tiger Airways' independent directors have recommended that shareholders accept the offer and that "the majority of analysts who cover Tiger Airways have recommended that shareholders accept the offer".