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KUALA LUMPUR: AirAsia X Bhd
(AAX) has entered into a non-binding letter of acceptance with Capital A Bhd for the proposed acquisitions of its aviation businesses, namely AirAsia Bhd and AirAsia Aviation Group Limited.
In a statement, the carrier said the move positioned AAX to become the overarching regional aviation provider for all short and medium-haul routes under the AirAsia brand name.
The decision to combine the airline businesses through these acquisitions leverages AAX’s robust recovery trajectory after its upliftment from the Practice Note 17 (PN17) status in November 2023.
“These strategic acquisitions serve as pivotal milestones in AAX’s post-PN17 revival strategy, bolstering our financial stability and enhancing our market positioning.
“The consolidation under the AirAsia brand as a one-listed entity reflects our commitment to capitalise on our regained strength and market confidence to deliver a unified and unparalleled travel experience for our guests and significant value for our shareholders,” AAX chairman Datuk Fam Lee Ee said.
“The synergy created through these strategic acquisitions represents more than just a financial consolidation; it symbolises our role as a trailblazer in shaping the future of the aviation industry. The future holds immense potential, and we are excited to embark on this transformative journey.”
AAX said the detailed announcement on the proposed acquisitions, including their effects on various financial metrics is expected to be announced in due course, subject to the definitive share sale and purchase agreement and its completion.
In a separate statement, Capital A CEO Tan Sri Tony Fernandes said: “All businesses across Capital A have been thriving and we are ready to grow. We need to raise funds for business expansion, but gaining access to capital has been challenging due to Capital A’s PN17 status. We have been engaging committed investors who have expressed a strong preference for a pure aviation play.”
“To address this and to ensure a robust financial injection, we are strategically pursuing the sale of the aviation business to AAX to create an aviation pure play, consolidating both long and short-haul airlines under the AirAsia brand, subject to the negotiation of a definitive share sale and purchase agreement and its completion.
“Following the disposal, the aviation business is poised to benefit from focused management and a well-defined strategic direction, which will boost the aviation business’s capacity to seize growth opportunities, expand market share, and ultimately achieve enhanced profitability,” he said.
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