Richard Branson prepares to take on Qantas

The low-cost carrier was launched three years ago and has almost a third of the Australian market.

Virgin Blue hopes its share sale set for 8 December will raise as much as A$558m ($397m; �237m) to fund its challenge of market leader Qantas.

Mr. Branson started Virgin Blue with a A$10 m investment and his Virgin Group will remain the largest shareholder.

Australian transport company Patrick Corp owns 45 percent of Virgin Blue.

After the flotation - which will see Virgin sell some of its own shares - outsiders will own about a quarter of the company.

Shares of Quantas dropped 1.2 percent in Sydney following the announcement.