AirAsia (AK, Kuala Lumpur International) is close to finalising its negotiations for up to MYR1 billion ringgit (USD235 million) fresh capital from undisclosed investors, deputy group chief executive officer, Farouk Kamal, said at an industry event.
As reported by Reuters, Kamal said the talks were "not just from an equity injection perspective, but from an overall transactions perspective". He did not provide any further details regarding the timeline, the structure and terms of the financing, or any hints about the investors' identity.
Earlier this year, reports surfaced that Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), would inject USD100 million into the carrier to finance its fleet growth. While AirAsia never commented on these rumours, it recently announced plans to establish a "virtual hub" in the Middle East to serve Europe with one-stop services from Southeast Asia, and said that Saudi cities were potential candidates.
The Malaysian LCC group is undergoing major corporate restructuring. Its current parent, Capital A, is looking to shortly exit the PN17, a distress status imposed by the Bursa Malaysia. Once the process locally known as "regularisation" is completed, AirAsia X will acquire AirAsia from Capital A. The holding will retain an 18% stake in AirAsia X but no direct shares in AirAsia or AirAsia Aviation Group, the entity used to team up with foreign partners in AirAsia-branded JVs outside Malaysia. The MYR1 billion capital injection is one of the conditions of the "regularisation".
