KUALA LUMPUR (May 4): Malaysia Airlines Bhd's parent Malaysia Aviation Group (MAG) claimed today it never had merger and acquisition (M&A) talks with budget airline AirAsia Group Bhd as the aviation sector contended with the impact of the global Covid-19 pandemic-driven movement restriction policies, which brought the industry to its knees.
MAG group chief executive officer Captain Izham Ismail claimed today MAG “never had such conversations” with AirAsia Group.
“If I speak for myself personally, if I am able to restructure the organisation, why would I go and throw ourselves to another organisation which is trying to survive.
“It will take a big toll on the original culture of the organisation,” Izham said today during a virtual press conference on MAG's business update.
As part of MAG's long-term business plan aspiration, Izham said the group is committed to delivering healthy return on investments in 2021 through a holistic capital allocation framework to ensure sound investment decisions for the group.
“We will also engage with policymakers to establish a comprehensive aviation market regulation framework that promotes healthy and sustainable competition,” Izham said.
Khazanah Nasional Bhd — Malaysia's sovereign wealth fund — via MAG owns 100% of Malaysia Airlines.
Khazanah said in a statement on March 4 it continues to provide full support and close cooperation in the comprehensive efforts to ensure the national carrier's sustainability post-Covid-19 pandemic.
"On Feb 22, 2021, the High Court of Justice of England and Wales sanctioned a scheme of agreement between MAG's leasing entity, MAB Leasing Ltd, and the majority of MAG's aircraft operating lessors, following unanimous support from the lessors.
"This represents an important component of the wider restructuring exercise which will achieve a reduction in MAG's liabilities of over RM15 billion. Moving forward, MAG will focus on working closely with the government and stakeholders on restarting air travel and promoting industry recovery, as well as continuing cash conservation while capturing demand recovery as part of its internal restructuring," Khazanah said.
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