AirAsia turns loyalty programme management firm into a subsidiary

KUALA LUMPUR: AirAsia Bhd is boosting its shareholding in Think BIG Digital Sdn Bhd, the manager of the AirAsia BIG global loyalty programme, by buying up to a 25.8% stake for RM101.5mil.

If it takes up the full 25.8%, its shareholding will increase to 71.9%. 

The low-cost carrier told Bursa Malaysia that acquiring the stake from Tune Money International Sdn Bhd would give AirAsia additional benefits that could only be realised through greater controlling stake of Think BIG Digital.

“Subsequent to the acquisition, Think BIG would be a subsidiary to AirAsia, and AirAsia would have greater strategic control over day-to-day operations at Think BIG to drive the business forward. This would allow AirAsia to extract greater value from the AirAsia BIG loyalty programme managed by Think BIG Digital,” it said.

Greater control would also accelerate decision-making with regards to AirAsia priority items that would help support the company’s business plan and commercial objectives, AirAsia said.

Additionally, AirAsia said by increasing the stake in Think BIG to above 50%, Think BIG would no longer be classified as an associate and it would be able to consolidate Think BIG’s contributions to the company’s revenue, which would improve AirAsia’s top line.

AirAsia and Tune Money are deemed related parties by virtue of the fact that two of Tune Money’s shareholders and directors - Tan Sri Tony Fernandes and Datuk Kamarudin Meranun - are also shareholders and directors in AirAsia.

The AirAsia BIG global loyalty programme managed by Think BIG is the global points currency serving AirAsia and the Tune group. The programme has about 15.6 million members across Asia-Pacific and elsewhere.

Following the proposed disposal, Tune Money would still own 11.1% in Think BIG. The other shareholder is Aimia Holdings UK II Ltd with a 17% stake.

Among the conditions precedent is getting a written authorisation from Aimia on the sale and transfer of the acquisition shares to AirAsia. 

AirAsia shares slid 4 sen to close at RM1.38 onm Wednesday, with 10.3 million shares changing hands.