Singapore Airlines is pleased that Virgin Australia is improving its financial performance, but it has yet to decide whether it will boost its stake in the Australian carrier to 25.9 per cent to equal the other major airline shareholders, Air New Zealand and Etihad Airways.
Singapore Airlines has a 22.8 per cent stake in Virgin and a seat on its board. 
"We have [Foreign Investment Review Board] approval up to 25.9 per cent," Singapore Airlines chief executive Goh Choon Phong told The Australian Financial Review during a visit to Canberra on Wednesday to announce the launch of direct services from the national capital to Singapore from   September. "Whether or not we increase to that level is something we will decide along the way."
His comments marked the first time Singapore Airlines has revealed its approvals for a 25.9 per cent stake, the carrier having previously declined to state how high it is permitted to raise its stake in Virgin.
The top four shareholders in Virgin, which also include Sir Richard Branson's Virgin Group, already hold nearly 85 per cent of the airline's shares. 
The low level of the free float has led to speculation some or all of the major shareholders could combine forces to take the carrier private, although Air NZ has said it prefers Virgin as a listed entity to subject it to financial discipline and keep it more anchored as an Australian company.
Credit Suisse analyst Paul Butler last week said he believed there was a floor under the Virgin share price as a result of the threat of the airline shareholders buying out other investors.
Mr Goh said any change in the current situation would be a decision for the Virgin board, on which he served as a member until he stepped down in last month in favour of another Singapore Airlines executive, Marvin Tan.
"We should in due course let [the Virgin board] have that discussion," Mr Goh said. "But currently we are happy with Virgin being listed. If something changes we will have to evaluate it as a shareholder, but this is not the point at which we would evaluate it."

'Weak' balance sheet
Virgin last year reported a $49 million underlying pre-tax loss at a time when rival Qantas reported a $975 million underlying pre-tax profit. Virgin is expected to swing to a $142.8 million underlying pre-tax profit this year, but that will pale in comparison to the $1.65 billion expected from Qantas, even adjusted for the size of the carriers.
Mr Butler said Virgin's balance sheet was in weak condition and the falling Australian dollar would increase its debt burden by about $150 million this year, because most of its debt was denominated in US dollars.
"While Virgin is focused on balance sheet repair, it will have less ability to invest in growth, and capacity additions in the domestic market may be low," he said.
Mr Goh said he couldn't comment on Virgin's financial performance given the Australian carrier was due to release its first-half results next month, but he added "it is certainly improving, so I think that is good."

Search for opportunities in Australia
For its part, Singapore Airlines has announced plans to increase capacity between its Singapore hub and key Australian cities, including Sydney, Melbourne, Brisbane and Canberra, on which it code shares with Virgin.
"You can anticipate we will continue to look for opportunities to grow in Australia," Mr Goh said. "We are happy with the demand."
Mr Goh said he was not overly concerned about the weaker Australian dollar.
"On the whole we are generally happy with the Australian traffic we are carrying. One has to understand of course we are not just carrying Australian traffic," he said. "We are also connecting our global network into Australia. Those sales will be in another currency as well."
The new flights between Singapore and Canberra will fly on to Wellington, marking Singapore Airlines's first entry into the highly competitive trans-Tasman market. Mr Goh said he would not rule out adding more trans-Tasman capacity, although there were no plans to do so at present.
"We will look at it," he said. "If the market makes sense, we will consider it."
A decade ago, Singapore Airlines made a push to the Australian government to gain traffic rights between Australia and the United States, but its lobbying efforts ultimately failed.
Mr Goh said Singapore Airlines was still interested in the trans-Pacific route over the longer term, even though Virgin flies it in partnership with Delta Air Lines.
"We continue to believe we want a more liberal air services agreement ... although it is not something that we have an urgent need for at this point in time," he said. "Given that we are in such deep partnership with Virgin, we are having some discussions with Virgin for example whenever we have changes in our Australian network. This would be part of the decision-making process [on the trans-Pacific]. But of course ultimately our position will be based on the commercial benefits for [Singapore Airlines]."