Singapore Air, Virgin Australia sign partnership

SYDNEY (Reuters) - Singapore Airlines (SIAL.SI) has formed an alliance with Virgin Australia VBA.AX under a deal which will allow the two airlines to sell tickets and seats on each other's international and domestic flights, Virgin said on Tuesday.

Virgin, Australia's second-largest carrier, said on Tuesday the airlines planned to code-share on flights and offer reciprocal frequent flyer program benefits and lounge access.

Virgin had been looking for a partner in Asia after forming alliances and partnerships with Delta Airlines (DAL.N), Etihad and Air New Zealand AIR.NZ.

The alliance is aimed at connecting Singapore Airlines' international network with Virgin's routes within Australia and in the Pacific.

"With regulatory approval, the partnership will enable us to offer even more choice for domestic and international air travel," Singapore Airlines chief executive Goh Choon Phong said in a statement.

The alliance is subject to approval from the Australian Competition and Consumer Commission (ACCC).

Asia is one of the fastest growing markets for air travel globally and a key battleground for airlines in the region.

Australia's biggest airline Qantas Airways (QAN.AX) is looking at a range of options to strengthen its international operations, including the possibility of basing a new premium airline in Singapore, according to sources.

Qantas already has a low-cost subsidiary Jetstar Asia which operates out of Singapore.

Virgin Australia was previously known as Virgin Blue until it rebranded itself last month as part of efforts to increase its share of the Australian business market off Qantas.

(Reporting by Michael Smith; Editing by Balazs Koranyi)