KUALA LUMPUR (Feb 11): Capital A Bhd (formerly known as AirAsia Group Bhd) has tapped former telecommunications executive Tan Sri Jamaludin Ibrahim to join its aviation arm’s board as its new independent non-executive chairman.
Prior to his current appointment to AirAsia Aviation Group Ltd (AAAGL), Jamaludin — who currently chairs Prasarana Malaysia Bhd and QSR Brands (M) Holdings Bhd — was group chief executive officer (CEO) of Axiata Group Bhd for 13 years until December 2020 and the CEO of Maxis Communications Bhd for 10 years prior to his stint at Axiata.
The name change of Capital A’s airline group from AirAsia Aviation Ltd (AAAL) to AAAGL and a corporate consolidation of its aviation-related businesses along with Jamaludin’s appointment were also announced by Capital A at a virtual press conference on Friday (Feb 11).
Jamaludin said he would be a mentor and provide guidance to the airline’s management rather than being involved in the daily running of the company in his non-executive capacity.
He also highlighted that his appointment and the establishment of an independent board is to build a “gold standard” in corporate governance and discipline in AAAGL.
“Apart from [corporate governance], there are two areas that I am very keen on and might spend a bit more time than normal, specifically talent which is always dear to my heart over my 30- to 40-year career, and digitalisation which I have worked on across organisations of different sizes,” Jamaludin said.
Capital A’s CEO Tan Sri Tony Fernandes said Jamaludin’s appointment will refresh the airline’s leadership while also bringing new ideas and perspectives amid the group’s pivot from a pure-play airline into a vertically integrated aviation group that is focused on the Southeast Asian region.
Potential spin-off of airline business on the cards
Fielding questions from the media, Fernandes said the investment holding group has plans to list AAAGL separately when market conditions recover, as it supports and provides an alternative to fundraising as certain investors may prefer to invest in the airline business exclusively.
“You begin to see what Capital A’s plan is. We now have six incredible companies and they will all be managed independently with advice from Capital A’s board.
“[The decision] to raise capital independently will depend on the board of the respective companies at the right time. But from Capital A’s board, [a spin-off listing] is definitely a plan,” Fernandes said.
Meanwhile, Fernandes said the group remains committed to the Southeast Asia region and that Indonesia is a key market for not only the airline but also Capital A’s other businesses ahead of the country's planned capital migration from Jakarta to Nusantara by 2024.
He highlighted that while the airline has seen success ahead of Indonesia’s flagship carrier Garuda Airlines in international flights, it has not been able to replicate the same in terms of domestic flights.
He added that the airline is in the midst of increased capacity domestically while waiting for the largest country in Southeast Asia to open up, noting that it hopes to utilise all of its 200-aircraft fleet as soon as possible.
According to a separate statement, AAAGL will have a new board of independent directors — except for Bo Lingam, AAAGL’s group CEO — which is separate from the investment holding group’s board to provide greater focus on the aviation business’ sustainable growth which includes setting up new joint ventures in the future.
AAAGL will now oversee all of the airlines under Capital A and its related international support functions which include AirAsia Consulting, shared corporate services division AirAsia SEA, the Santan food group and the ground handling services joint venture business called GTR, according to the statement.
Bo noted that the rationale for these structural changes is to provide a separate, robust and lean platform for the airline operations supporting Capital A’s continued focus to become more than just an airline.
“AAAGL will become one of the key pillars under Capital A, alongside the new digital businesses and aircraft engineering company, Asia Digital Engineering (ADE) — which is also preparing to announce a new board of directors in the near future, as a separate entity to AAAGL,” Bo said.
At midday market break on Friday, Capital A traded one sen or 1.5% higher at 67.5 sen, giving it a market capitalisation of RM2.81 billion based on 4.16 billion outstanding shares.