SINGAPORE - The Competition Commission of Singapore (CCS) has cleared the proposed acquisition of Tiger Airways Holdings by Singapore Airlines (SIA).

The competition watchdog said on Friday that the transaction would not infringe the Competition Act as the budget carrier would be likely to exit its operations if the acquisition did not go ahead.

SIA, currently the largest shareholder of the budget airline, plans to increase its stake from 40 to 56 per cent - which would cause Tiger Airways Holdings to become a subsidiary of SIA.

A controlling stake will allow the premium carrier to shape Tigerair's future, including pushing for closer ties with SIA's long-haul budget arm, Scoot, analysts say.