AirAsia sells online travel agency stake for RM240mil

KUALA LUMPUR: AirAsia Bhd is selling its entire 25% stake in online travel agency AAE Travel Pte Ltd to joint-venture (JV) partner Expedia Southeast Asia Pte Ltd for RM240mil cash.

The disposal will result in a gain of RM230.4mil to be realised in the third quarter of this year, the low-cost carrier said in a filing with Bursa Malaysia on Tuesday.

“AirAsia’s rationale for the transaction is to monetise its investment in the JV company and to increase the group’s working capital,” it said.

The Singapore-registered JV company, AAE Travel, was established in 2011 as an equal venture between AirAsia and Expedia. AirAsia, in March 2015, had halved its stake in the JV company after it sold a 25% share to Expedia.

“This sale represents the divestment of the last of our non-core investments from the previous round of JVs,” AirAsia’s group CEO Tan Sri Tony Fernandes said in a separate statement.

The proceeds, he said, will be used to develop “big unicorn” products such as BigPay, Travel 360, Redbox Logistics and Ourshop.

Expedia said the purchase is net of AirAsia’s concurrent purchase of AirAsiaGo.com domain names and related assets from AAE Travel. AirAsiaGo.com, which offers a full suite of travel products including AirAsia flight and hotel packages featuring Expedia Group lodging content, will continue to be powered by Expedia Group.

“Acquiring full ownership of AAE Travel reflects our belief in the immense potential for us in the over US$485bil Asian travel market,” Expedia group president and CEO Mark Okerstrom said.

“This transaction unlocks better integration of our Brand Expedia Asia business into our core global travel platform, giving us even greater confidence in our ability to harness the huge growth potential that Asia represents.”