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Published: Thursday May 3, 2012 MYT 9:07:00 AMUpdated: Thursday May 3, 2012 MYT 10:44:16 AM
KUALA LUMPUR: Shares of AirAsia slipped in early trade on Thursday after Khazanah Nasional and Tune Air reversed the share swap exercise for their stakes in AirAsia and MAS while overall market sentiment was also cautious in line with the mixed overnight close on Wall Street.
At 9.03am, AirAsia was down six sen to RM3.27, off an early low of RM3.20. MAS was up one sen to RM1.23.
The FBM KLCI was down 0.92 of a point to 1,581.47. Turnover was 41.52 million shares valued at RM18.95mil. There were 77 gainers, 52 losers and 101 stocks unchanged.
In a research report, Hwang DBS Vickers Research (HDBSVR) said it was maintaining its Fully Valued call on MAS and AirAsia with target prices of RM1.10 and RM3.10 respectively.
HDBSVR said the operating environment for airlines remains challenging due to stubbornly high oil prices, which could dampen passenger travel demand.
On Wednesday, Khazanah Nasional and Tune Air, the major shareholders of MAS and AirAsia respectively had agreed to terminate their share swap agreement.
Following the termination of the agreement, Khazanah will take back the 685.14 million MAS shares representing a 20.50% stake in MAS held by Tune Air, according to announcements made by MAS and AirAsia to Bursa Malaysia.
Similarly, Tune Air will take back 277.65 million ordinary shares of 10 sen each in AirAsia held by Khazanah, representing approximately 9.99% equity interest in AirAsia.
Following the termination of share swap, the boards of MAS and AirAsia had agreed to mutually terminate the proposed warrants exchange and the warrants exchange agreement on Oct 21, 2011.
With the latest development, the respective focus areas of MAS, AirAsia and AirAsia X Sdn Bhd as stated in the earlier collaboration agreement would cease.
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