Budget carrier Tiger Airways, 49 % possessed by Singapore Airlines, has contracted its IPO.

Tiger will raise S$200 million - $250 million which was earlier planned at S$420 million, as reported by a source. But another story cooking up reveals that Tiger would offer S$250 million worth of shares with an option to increase the issue size by 10-15 percent.

It is planning to utilize the amount for buying a new aircraft and also to pay off its liabilities.

This budget carrier has done tremendously well in Singapore but it suffered a S$50.8 million loss in March 2009 which were the costs incurred in starting up its Australia-based operations.

Falling travel and a rally of fuel prices are some problems that worry The International Air Transport Association (IATA) which claims that the world's airlines are set to lose $5.6 billion in 2010.