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.

Virgin Australia claims Qatar Airways' proposal to acquire 25% of the carrier would benefit small and medium-sized enterprises.

Qatar Airways has entered into an agreement to purchase a 25% stake in Virgin Australia from owner Bain Capital for an undisclosed amount.