No merger but a separate entity to be formed, says Capital A

Capital A Group chief executive officer Tan Sri Tony Fernandes. - REUTERS/Lim Huey Teng

PETALING JAYA: Capital A Bhd has clarified that there is no plan for a merger between AirAsia Bhd and AirAsia X Bhd (AAX), but a separate publicly-quoted aviation group will be formed under the proposed Practice Note 17 or PN17 exit strategy.

“The company wishes to clarify that the proposed plan is not a merger of AirAsia and AAX, but a potential disposal of Capital A’s aviation assets to AAX, in order to form a separate publicly-quoted aviation group comprising six airlines – four short-haul Asean airlines and two medium-haul airlines, namely, AirAsia, Thai AirAsia, AirAsia Indonesia, AirAsia Philippines, AAX and Thai AirAsia X,” Capital A said in a filing with Bursa Malaysia.

The group further said the plan remains a work in progress and will be subject to multiple approvals, including by the company’s board of directors, shareholders and Bursa Malaysia.

The company will make the requisite announcements once the plan is finalised, Capital A added.

On Monday, Capital A chief executive officer Tan Sri Tony Fernandes told the media that all aviation operations will be injected under one existing structure, namely, the AirAsia Aviation Group (AAG).

“We are just injecting AirAsia airlines into AAX’s listing status. There is no merger. AAX will be renamed AAG and there will be six airlines under it.

“As one company, we can take out a lot of costs, but there will be separate operations by each individual airline,” he said.

Capital A shares on Bursa Malaysia closed 1.5 sen higher to 58.5 sen with 3.69 million shares changing hands, while AAX was flat at 44.5 sen with 100,100 shares transacted. —Bernama