KUALA LUMPUR (Sept 27): AirAsia X Bhd (AAX) is selling its ramp equipment to Ground Team Red Sdn Bhd (GTR), a wholly-owned subsidiary of AirAsia Bhd for RM4.63 million.

The long-haul, low-cost carrier will also transfer 424 of its employees to GTR.

GTR is deemed a related party to AAX by virtue of the fact that AirAsia's directors and major shareholders Datuk Kamarudin Meranun and Tan Sri Tony Fernandes are also the directors and major shareholders in AAX.

In a filing with Bursa Malaysia today, AAX said it has signed a sale and purchase agreement (SPA) with GTR for the sale of ramp equipment and transfer of employees.

The airline said it will make a gain of RM225,972.05 from the SPA, as the original cost of investment for the ground equipment was RM10.17 million. The equipment's net book value stood at RM4.4 million as at Sept 27, 2017.

The airline also entered into an agreement with TCR Solution Sdn Bhd and I Tech Engineering and Machinery Sdn Bhd to novate related contracts to GTR.

"The purpose of the SPA and novation agreements is to facilitate the establishment of GTR through the integration of all AirAsia's and AAX's ground equipment. (GTR) will charge a lower ground handling rate compared with independent third party ground handler market rates," said AAX.

"This will allow AAX to invest more manpower and focus on new business strategies to turnaround AAX, rather than put their efforts and resources in the ground handling business, which is not a core airline business," it added.

AirAsia shares closed up three sen or 0.88% at RM3.43 today for a market capitalisation of RM11.46 billion, while AAX's stock remained unchanged at 38 sen, valuing it at RM1.57 billion.