AirAsia is close to finalising discussions with strategic investors as it nears the completion of a major restructuring initiative, according to Deputy Group Chief Executive Officer Farouk Kamal. Speaking at the Reuters NEXT Asia summit on Wednesday, Kamal confirmed the Malaysia-based low-cost airline is advancing towards a pivotal stage in securing new funding and operational consolidation.
The carrier, a unit of Capital A Berhad, was designated as financially distressed by Bursa Malaysia in 2022. In response, the group is currently coordinating a RM1 billion (approximately $235 million) equity injection, alongside efforts to finance its substantial aircraft order book.
In March, Capital A Group Chief Executive Officer Tony Fernandes stated that the RM1 billion private placement was “done”, although no further details regarding investor identities have been disclosed. He declined to comment on a Bloomberg report that named Saudi Arabia’s sovereign wealth fund as a potential contributor of $100 million.
Kamal highlighted that the investment discussions are reaching a comprehensive conclusion, encompassing more than equity alone. “It’s not just from an equity injection perspective, but from an overall transactions perspective,” he said, adding that an official announcement is expected in due course.
AirAsia remains one of Asia’s largest low-cost carriers and a major client of Airbus, with approximately 360 aircraft currently on order. The airline further expanded its commitment to the European aircraft manufacturer last Friday by signing a memorandum of understanding to acquire 50 long-range A321XLR aircraft, with conversion rights for an additional 20 units of the same model.
As part of the restructuring efforts, Capital A is in the process of divesting its aviation business to long-haul affiliate AirAsia X. The consolidation is intended to unify both long-haul and short-haul services under the AirAsia brand.
Fernandes recently reiterated his ambition to remove the group from its financially distressed classification once restructuring measures are finalised.
-Reuters
