(August 29): Loss-making Malaysia Airlines will cut its workforce by 30% to 14,000 and move its headquarters and principal operations to KLIA under a restructuring exercise that will cost RM6 billion.
Its main shareholder, Khazanah Nasional Bhd, announced that 6,000 jobs will be cut at the national carrier which has lost at least RM3 million a day for the first half of the current financial year.
The losses widened after the flag carrier suffered two major disasters with the mysterious disappearance of flight MH370 and the downing of flight MH17.
According to a report by Reuters, the state fund said the airline will be de-listed from the Kuala Lumpur exchange by the end of 2014, adding that Ahmad Jauhari Yahya will stay on as chief executive until July 2015.
In the same report, Khazanah said it aims to return the airline to profitability within three years of its de-listing, and plans to re-list the carrier in three to five years from now.
Yesterday, MAS said its second-quarter nett loss widened to RM307 million from RM176 million a year earlier, though the result was an improvement from the net loss of RM443 million in the first quarter.
MAS warned of poor second-half earnings as passenger bookings continue to fall, with business hit by the shooting down of flight MH17 over Ukraine in July and the unexplained disappearance of flight MH370 in March.
MAS has posted three straight years of losses in the face of competition from rising budget airlines like AirAsia Bhd .
Khazanah, which currently has a 69% stake in the carrier, has injected more than RM5 billion into MAS over the last 10 years.
Khazanah said it plans to reduce the nett gearing of the airline through debt-for-equity swaps.
Malaysia Airlines will retain global flight connectivity through the Oneworld alliance and code-sharing, Khazanah said.