TALK of selling Malaysia Airlines Bhd (MAS) seems to be getting louder these days.
Simply because it has become too much of a burden for the government to keep pouring RM1bil every year to keep the airline in the skies.
Just too much money has gone into saving MAS.
Since 2001, about RM23.6bil has been poured into saving MAS.
It seems like a bottomless pit, wanting more.
If this money was used for other things, hundreds of schools, hospitals, clinics and roads could have been built.
Even if more money is pumped into MAS now, There is no guarantee of returns, experts say.
It is about time it is sold or shut down, they say.
“The government seems open to foreign buyers. Bids are coming from inside and outside Asia, Middle Eastern and China parties.
“Even some local parties are looking at it. Only those with deep pockets should be considered,” says a source.
There is talk that even Malindo Air is interested.
But its interest could be an alliance or taking over of some routes/assets.
The foreign parties that have put in bids may not necessarily be airlines.
However, a recent report suggested Qatar Airways may be a good fit.
“With Malaysia Airlines’ proximity and slots in the antipodean region, it would be a huge benefit to the airline to get a piece of that action,’’ says the report.
The report could not be verified.
But one wonders how much stake can they buy.
As it is, Qatar has small stakes in several airlines.
It has about 10% in Cathay Pacific, LATAM (10%), IAG (20%), South China Airlines (5%) and Air Italy (49%). It recently denied buying 49% of Turkish Airlines.
It is a fact that both Qatar and Emirates are the most active Middle Eastern carriers that continue to scale new grounds.
Apart from that, several turnaround experts have come up with various proposals on how best to save the airline.
Perhaps, their assumption is that the government will continue to save MAS.
This includes the proposal by the former employees of Malaysia Airlines System Bhd.
The group has even formed a company known as Golden Skies Ventures Sdn Bhd to help turn MAS around.
What really matters now is that MAS has to be commercially driven if it is to remain in the skies.
“Whatever the decision this time around, let it be a business deal and not one that is politically motivated,’’ says a source.
In the past “there have been too many political interferences and abuse.
“Legacy carriers are tools for steady income stream from aircraft procurement and maintenance for some.
“Just because it is a national carrier it had to fly to places even if did not make economic sense. That has to stop.’’
The source adds that “there has also been too many turnaround plans including the 12-point crafted by its parent Khazanah Nasional Bhd.
“None has yield the returns they promised despite the 6,000 job cuts and hiring of foreign CEOs. Someone should be made accountable for all that.’’
With the benefit of hindsight, had MAS just stuck to the deal it had with Qantas, or even AirAsia, it would not be in dire straits now.
Way back in 2009, there was a deal on the table for a collaboration with Qantas.
Then the Australian player wanted access into Malaysia and other South-East Asian markets. It would have made perfect sense.
But then the government succumbed to pressure from the airline’s workers which scuttled the deal.
In 2012, the MAS-AirAsia share swap deal was also scrapped because of pressure from the 19,000 workers of the airline.
They were “averse to AirAsia taking a substantial stake in MAS.’’
Khazanah also rejected the proposal in November 2014 by private firm Jentayu Danaraksa Sdn Bhd to buy over MAS aircraft via a sale and leaseback arrangement worth RM5.25bil, and undertake to refinance the RM3.5bil bond issue by Penerbangan Malaysia Bhd, which was due in 2016.
“Too many mistakes have been made in the past. This time around, there is just too much risk to keep it flying,’’ says the source.
It is therefore “critical to make a decision on this matter as soon as possible and not lose another good opportunity for the airline to remain in the skies.
“Or else in a matter of months it may be declared bankrupt.
“This is because Khazanah may not be able to pour more money into saving MAS,’’ says an expert.
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