By Gaurav Raghuvanshi
SINGAPORE--Singapore Airlines Ltd. (C6L.SG) said Monday its offer to buy all the shares of unit Tiger Airways Holdings Ltd. (J7X.SG) is "compelling," and asked shareholders to consider its rationale when deciding whether to accept the offer.
Singapore Airlines, which owns 56% of its unprofitable discount carrier unit, last month offered to buy the shares of Tiger that it doesn't own at 41 Singapore cents (29 U.S. cents) apiece, a 32% premium to Tiger's last traded price before the offer was made.
The Singapore flag carrier's comment was in response to an open letter last week from the Securities Investors Association (Singapore), a local body for the protection of retail shareholders' rights. SIAS said in the letter that Singapore Airlines should consider offering "better" terms to Tiger's minority shareholders and give them more time to decide on the offer.
Singapore Airlines said an independent financial advisor appointed by Tiger Airways to evaluate the offer has said the financial terms are "on balance, fair and reasonable."
Singapore Airlines also said Tiger's independent directors and the majority of analysts who cover the airline have recommended that shareholders accept the offer.
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