Tiger Airways subsidiary proposes to sell SEAir interest for $7m

Sale and purchase agreeement signed.

The board of directors of Tiger Airways Holdings Limited announced that Roar Aviation II Pte Ltd. (Roar II), a wholly-owned subsidiary, has on 10 February 2014 entered into the sale and purchase agreement with Cebu Air in respect of the proposed sale of its entire shareholding interest in SEAir, representing 40% of the issued and outstanding shares in SEAir.

Tiger Airways said it will convene an extraordinary general meeting (EGM) to seek approval from its shareholders for the proposed sale. A circular setting out further information and details of the proposed sale, together with the notice of EGM to be convened will be dispatched by the company to shareholders in due course.

As announced in the Offer Letter Announcement, the consideration to be received by Roar II for the sale shares is US$7,000,000 (approximately S$8,750,000), and will be satisfied by Cebu Air on the closing date.

The investment in SEAir had been fully impaired in accordance with the Singapore Financial Reporting Standards, and hence the book value of SEAir, which is the carrying value in the group's unaudited financial statements as at 31 December 2013, is nil. The excess of the consideration of $7,000,000 (approximately S$8,750,000) over the book value of SEAir is $7,000,000 (approximately S$8,750,000).

Assuming that the proposed sale had completed on 31 December 2013, the estimated net loss arising from the Proposed Sale is S$30.3 million, subject to any other accounting adjustments which may be necessary upon finalisation of the proposed sale. The estimated net loss is derived by deducting the consideration of S$8.8 million from the amount required to settle SEAir liabilities, forward sales and transaction cost aggregating to S$30.3 million, and included an impairment loss of S$8.8 million.

The company, through Roar II, intends to use the proceeds from the proposed sale to partly satisfy the liabilities and forward sales of SEAir.