After Qantas successfully lobbied against extra Qatar Airways flights, the Middle Eastern airline has exacted revenge on the Flying Kangaroo with a deal that will increase competition and possibly result in cheaper fares.

Qatar Airways will buy a 25% stake in Virgin Australia from U.S. private equity firm Bain Capital, posing a tougher contest for Qantas Airways that has dominated Australian routes and pushed back against giving access to the Middle Eastern carrier.

Australia’s second-largest airline, Virgin Australia, said Middle Eastern carrier Qatar Airways plans to acquire a 25% stake, a key investment as the Bain Capital-owned carrier eyes an IPO.

Qatar Airways plans to take a 25% stake in Australia’s Virgin Australia Airlines Pty, expanding the Gulf carrier’s global network of equity holdings.

Qatar Airways will buy a 25% stake in Australia's No. 2 airline Virgin Australia from U.S. private equity firm Bain Capital, the companies said on Tuesday, as the Gulf carrier looks for access into Australian routes that the government denied last year.

The deal will see Qatar Airways buy a 25 per cent equity stake in Virgin Australia from private equity group Bain Capital, which bought the carrier originally set up by Sir Richard Branson out of administration during the pandemic.

Qatar Airways unveiled a bid to take a 25 percent stake in troubled airline Virgin Australia on Tuesday, a deal that could shake up Australia's Qantas-dominated market.