Tigerair takeover deal not fair for minority shareholders, says investing watchdog

The offer price is too low.

Retail investors who hold Tigerair shares might be getting the shorter end of the stick when it comes to Singapore Airlines’ proposed privatisation of the budget carrier, according to a statement from the Securities Investors Association Singapore (SIAS).

In a bid to take Tigerair private, SIA had earlier offered to pay 41 Singapore cents for Tigerair shares that it does not yet own, along with an option to subscribe for SIA shares at $11.1043 per share.

However, SIAS argued that the offer price is 39% lower than what a long-term minority shareholder would have paid for Tigerair shares.

“A Tiger Airways’ shareholder, who held on to his IPO shares that was bought for $1.50 a share and subscribed to all three rights issues since IPO would have paid an average of $0.67 a share,” SIAS President David Gerald said in a statement.

“While SIAS understands that the current market conditions are different, nevertheless, the minority shareholders’ interest must be taken into account. Therefore, SIAS calls upon the Board of Tiger Airways to carefully review the SIA offer to ensure that the minority is dealt with fairly. Minority shareholders should wait for the IFA report to determine the fairness of the offer,” the statement said.