Tiger Airways Holdings, the budget carrier part-owned by Singapore Airlines, will raise $233 million in Asia’s first initial public offering by an airline in five years.

 

The IPO shares were priced at $1.50 apiece, according to a pricing document sent to investors. The company had planned to offer shares for $1.35 to $1.65 apiece, a person familiar with the situation said earlier. Charles Sng, a spokesman for the airline, declined to comment.

 

Chief Executive Officer Tony Davis plans to use the money to pay for new planes to challenge rivals including AirAsia Bhd. and Australia’s Jetstar Airways Pty. Budget carriers are expanding in Asia as economic growth boosts demand for business and leisure travel in the region.

 

The airline, with operations in Singapore and Australia, is selling 155.6 million new shares. Indigo Partners LLC, Tiger Air’s second-biggest shareholder, is also selling 9.6 million existing shares, according to a company filing last week.

 

Singapore Air will control 33.1% of the budget carrier after the IPO, while Temasek Holdings will have 7.4%. Indigo Partners’ stake will fall to 14.5% from 24%.

 

As well as helping to finance new planes and repay loans, a portion of the funds may be used to set up a new airline or new operating bases, according to the prospectus.