KUALA LUMPUR: AirAsia X Bhd (AAX) said its proposed debt restructuring has accordingly been approved by the scheme creditors, as the requisite majority of 75% of each Class A, B and C creditors was obtained at their respective court convened meetings (CCMs).
In a filing with Bursa Malaysia, the long-haul, low-cost airline said 100% of the Class A and C creditors, and 97.6% of Class B creditors approved the proposed debt restructuring at the CCMs.
In late October, Reuters reported that AAX is proposing to pay just 0.5% of debt owed to each of its creditors and to terminate all existing contracts so that it can restructure RM33.65bil of liabilities.
“To avoid a liquidation and to allow the airline to fly again, the only option is for AAX to undertake the proposed debt restructuring,” the airline said in a document seen by Reuters.
Half of the total liability is the cost of terminating airplane orders from its largest creditor Airbus SE for 78 A330neo widebodies and 30 A321neo narrowbodies, the document said.AAX also proposed that if it were to garner more than RM300mil in annual earnings before interest, tax, depreciation and amortisation, lease rentals and restructuring costs during its 2023-2026 financial years, all creditors except Airbus would be entitled to 20% of those earnings.
The 0.5% of debt owed to each creditor will be paid from operating cash flow one year after the debt restructuring goes into effect, according to AAX.