Tiger Airways selling two A320 aircraft to rightsize fleet

TIGER Airways is selling two Airbus A320 aircraft to Stellar Aircraft Holding 1 at a loss to rightsize its fleet.

As at March 31, 2015, the carrying value of the two planes had been written down to S$71 million. Upon completion of the sale, Tiger will record an S$8 million loss on disposal.

"The sale allows Tigerair to reach an optimal fleet size, in line with its turnaround strategy," the budget carrier said. "Assuming the sale was completed by the end of last financial year, net cash position would have improved from S$3 million to S$66 million as at 31 March 2015."

Proceeds from sale - which is due for completion in Q2 of this year - will be used to fund the debt related to the financing of these aircraft.

The budget carrier has embarked on a restructuring as part of its efforts to turn itself around, which has seen it pull the plug on loss-making joint ventures overseas while rationalising Tigerair Singapore's network at home.