KUALA LUMPUR (Nov 28): Khazanah Nasional Bhd has received no less than 28 business proposals expressing interest in participating in or complementing its five-year 12-point recovery plan for Malaysian Airline System Bhd (MAS), which was announced on Aug 29.
"In this regard, we wish to state that as required by Khazanah’s operating processes and procedures, only credible proposals are evaluated and assessed, in a process that, if they qualify, will be ultimately tabled to the board of directors of Khazanah, or if appropriate, channeled to the management and board of the operating company (in this case, MAS)," said Khazanah, which is in the midst of taking MAS private, in a statement to update the on-going restructuring of MAS today.
Under the 12-point recovery plan, MAB is expected to achieve profitability by the end of 2017, three years from the delisting of MAS, and that MAB will be relisted between 2018 and 2020.
One such plan has come from newly set-up financial advisory firm, Jentayu Danaraksa Sdn Bhd, which has put in a proposal to the Prime Minister's Office early this month. The Malaysian Airline System Employees’ Union, MAS' biggest trade union, and the National Union of Flight Attendants Malaysia have given their backing to the company's alternative proposal to date.
Additionally, Khazanah said it has been approached by many individuals with relevant expertise and experience who voluntarily want to be part of the MAS restructuring effort.
"Thus far, numerous curriculum vitae (CVs) have been received and the applications reviewed, with several set to join the restructuring effort," it added.
Khazanah said implementation of the RM6 billion MAS recovery plan is on schedule in the three months since its launch in August.
"The restructuring of MAS is well on track, with several major milestones reached and several more expected in the next quarter, particularly by the end of the year," said Khazanah in the statement.
Khazanah expects to complete the delisting of MAS and announce the leadership of the new entity (NewCo) – named Malaysia Airlines Bhd (MAB) – by the end of this year, after obtaining MAS shareholders' nod for a selective capital reduction and repayment exercise (SCR) at an extraordinary general meeting on Nov 6. The SCR is expected to be completed by Dec 3, 2014, pending approval from the High Court.
"Encouraging progress has been made in the global search of leadership talent for MAB. Khazanah expects to make a key announcement on the leadership of MAB by the end of the year, as previously stated," said Khazanah, adding that the NewCo is targeted to be operational by July 1, 2015.
At the same time, a talent assessment process at MAS to identify the workforce required by the NewCo, estimated at 14,000 employees, is currently underway, said Khazanah.
"The process is being facilitated by an external independent advisory firm specialising in human resource. The assessment of the top 500 management personnel has been completed to date," it added.
On the movement of staff from Subang to the KL International Airport in Sepang, Khazanah said it is scheduled to begin in the second quarter of next year.
"The move had initially been planned to kick-off this year but was deferred to ensure that MAS employees who will not be migrating to NewCo would not be burdened unnecessarily by having to relocate to the KLIA area," it said.