Australian regulator expresses concern over Virgin-Tiger merger

Australia's competition regulator has reservations about Virgin Australia's plan to merge with Tiger Airways.

Two months ago, Virgin had announced a deal for the acquisition of 60 per cent of the loss-making domestic airline from its Singapore-based parent company worth $35 million.

Last month, Qantas and the Dubai-based airline Emirates received draft approval to a proposed alliance fron the Australian Competition and Consumer Commission (ACCC).

However, according to ACCC chairman Rod Sims, while international aviation was very competitive, there was more at stake in the Virgin-Tiger tie-up.

He told ABC News 24, that domestically, the Virgin-Tiger merger was complicated.

Sims said while on the one hand if the merger were to proceed, Virgin would be in a much better position to take on Jetstar by using Tiger, on the other hand, it would be taking out the third player in Australia's aviation market, which made for a very complex equation for its impact to be assessed.