http://malaysian-aviation-news.aerosoftseo.com/
http://malaysian-aviation-news.blogspot.com/
AirAsia may take domestic network, MAS take long-haul routes
* AirAsia would get 2 MAS board seats for CEO and deputy
* Combination could lead to higher airfares-analyst (Recasts with planned share
swap, adds analyst comment)
- Malaysian Airline System (MAS) and rival AirAsia are planning a share swap
that would give AirAsia's parent a
20 percent stake in Malaysia's national airline, a source with direct
knowledge of the deal said on Monday.
Under the deal, Malaysia's state investment arm, Khazanah
Nasional, which currently owns close to 70 percent of MAS,
would take a 10 percent stake in AirAsia, said the source who asked not to be
identified because the deal has not been announced.
"This will help to improve synergies between the two,"
the source said. "They have been competing unnecessarily
in the past and they will now pool their resources
together."AmResearch in Kuala Lumpur said in a note on
Monday that the share swap could position MAS as a
premium, long-haul carrier, while AirAsia takes on the
domestic, short-haul network.
The share swap is expected to aid MAS, which has struggled
to stay profitable, although it would be the second time
in 10 years that the national carrier is being
restructured to help its bottom line, analysts said.
AirAsia's chief executive, Tony Fernandes, and his
deputy Kamarudin Meranun, will sit on the board of
MAS after the restructuring, the source said, adding
that CIMB is the deal's adviser.Officials at MAS and
Khazanah Nasional were notimmediately available for
comment. AirAsia officials said the airline would make a
statement within a day or two.
The two airlines halted trading in their shares until
Tuesday, saying separately they need time to prepare an
announcement relating to "a material transaction."
Khazanah Nasional and AirAsia shareholders had denied
on Sunday reports that AirAsia's shareholders will emerge
as the largest owners of national carrier MAS shares. .
BACK TO MONOPOLY?
The global aviation sector has been hit by rising fuel
prices and economic instability, but MAS and AirAsia have
adopted different strategies to deal with the challenges.
MAS managing director Azmil Zahruddin told Reuters in
March that the airline was prepared for a stronger
future, although the Japan earthquake in March posed
a challenge.
In May, MAS posted a first quarter net loss of 242.3
million ringgit ($80.4 million) compared to a profit
of 310.6 million ringgit a year earlier, after a decent
FY2010 that saw its net profit surpass expectations of a
net loss.
In 2001, the authorities bailed out the then loss-making
MAS with about $472 million of state money, drawing
fierce criticism from investors who painted the deal as
government interference in the market."AirAsia was set
up to liberalise Malaysian skies,but with this partnership
, I see us going back to monopolies," said another
aviation analyst with a local bank. "At the end of
the day, it's the consumers who will suffer as monopolies
ually mean higher airfares."
AirAsia recorded a net profit of 171.9 million
ringgit in the first quarter, down almost 25 percent
from a year earlier. It is on a regional expansion drive,
with a source saying it had recently drawn up plans to
buy an extra 100 Airbus A320neo jets, potentially
taking a record-breaking order to 300.
The budget carrier plans initial public offerings in
Bangkok and Indonesia as it capitalises on demand in
the region for cheap air travel.
AirAsia shares last traded at 3.95 ringgit before they
were suspended, up 56 percent since the start of the
year, while MAS' stock was last traded at 1.60 ringgit,
down 23 percent so far this year. The overall index has
fallen 2.4 percent since the start of the year.
No comments:
Post a Comment