(AFP) Virgin Australia on Tuesday said it has bought a 60 percent stake in fellow low-cost carrier Tiger Airways Australia for Aus$35 million (US$36 million).

Virgin, Australia’s second-biggest airline, said the companies had also committed to invest a further Aus$62.5 million collectively into the business to fund growth in Tiger Australia, a subsidiary of Singapore’s Tiger Airways.

The deal will allow Tiger to expand its capacity in Australia, increasing its fleet from 11 aircraft to 35 by 2018, and offer more attractive offers to customers, they said in a release to the Australian stock market.

“By partnering with Tiger Airways, we can use our expertise to leverage Tiger Australia’s competitive cost base and build a sustainable budget carrier,” Virgin chief executive John Borghetti said.

While Virgin is taking a significant stake, Tiger will continue to operate under the Tiger Airways brand.

SOURCE AFP