SINGAPORE Airlines (SIA) stated on Monday that it is in talks to sell off its 49 per cent stake in Virgin Atlantic to unnamed parties.
In a short statement, the airline said:” Singapore Airlines wishes to announce that it is in discussions with interested parties concerning the possible divestment of its 49 per cent shareholding in Virgin Atlantic Limited.”
It added that “these discussions may or may not result in a transaction.”
According to Britain’s Sunday Times, Delta Air Lines is reportedly one of the interested parties that hopes to buy the stake to increase its presence in London’s Heathrow Airport, which is the busiest airport in Europe.
SIA bought the Virgin Atlantic stake for 600 million pounds (US$967 million) in 1999. Richard Branson, the founder of Virgin Atlantic, owns the majority 51 per cent stake in the latter.
Market analysts said the move comes as no surprise since SIA had not benefited much from Virgin Atlantic through the years.
“Virgin contributes very little to Singapore Airlines; they have been unable to generate any real synergies and there’s essentially been no marriage of the brands, no leverage of network opportunities,” said Timothy Ross, head of Asia-Pacific transport research at Credit Suisse in a Channel NewsAsia report.
