KUALA LUMPUR: Malaysian Airline System Bhd’s (MAS) influential and biggest trade union, the Malaysian Airline System Employees’ Union (Maseu), has given its backing to an alternative proposal by Jentayu Danaraksa Sdn Bhd. This will avert the need to lay off  6,000 MAS workers as stated in Khazanah Nasional Bhd’s rescue plan for the loss-making national carrier.

Jentayu Danaraksa, a newly set-up financial advisory firm comprising bumiputera professionals who specialise in aviation, corporate finance and capital markets, is headed by former MAS managing director and chief executive officer Tan Sri Abdul Aziz Abdul Rahman as its chairman.

On Aug 29, 2014, Khazanah announced a 12-point plan to resuscitate the national airline which would see a reduction of 6,000 jobs across the board from its existing workforce of 20,000.

In a letter dated Nov 3, 2014, to Prime Minister Datuk Seri Najib Razak and seen by The Edge Financial Daily, Maseu stated that it had discussions with representatives of Jentayu Danaraksa on the alternative proposal and agreed in principle on the company’s value propositions as opposed to Khazanah’s 12-point plan.

“We are in full support of Jentayu Danaraksa’s proposal and hope that Datuk Seri [Najib] seriously considers Jentayu Danaraksa’s proposal for the sake of our union members’ future and well-being,” said Maseu in the letter,  signed by its secretary-general Ab Malek Ariff.

When contacted by The Edge Financial Daily yesterday, Ab Malek declined to comment.

Jentayu Danaraksa’s major shareholder and director Feriz Omar confirmed that a proposal had been submitted to Najib and Khazanah, which “complements Khazanah’s 12-point plan”.

“We have identified areas that need to be emphasised which are critical success factors to turn around MAS even under a new entity,” he said.

Feriz declined to provide further details of Jentayu Danaraksa’s proposal to Najib and Khazanah, except that “several corporate transactions will be taken, which are in line with international policies signed by the Malaysian government, and most of the Asean countries”.

“Part of the overall proposal entails acquiring some strategic assets of MAS,” he said.

According to Feriz, the company is of the view that these identified strategic assets, which are still profitable, can utilise the skills of the 6,000 MAS workers to be laid off.

Khazanah’s RM6 billion recovery plan for MAS involves migrating “relevant” operations, assets and liabilities from MAS to a new entity, and the required workforce will be about 14,000, 30% or 6,000 lower than the current 20,000.

“We have submitted the proposal and Maseu’s letter to the Prime Minister’s Office and are waiting for their response,” Feriz said.

He believes that the alternative proposal will be beneficial to MAS stakeholders as the team under Jentayu Danaraksa that drafted it is equipped with the relevant know-how. The team includes Shukor Yusof, who had served as an aviation analyst in US ratings agency Standard & Poor’s for over 13 years.

According to the company’s website, Jentayu Danaraksa’s other directors include former Transport Ministry secretary-general Datuk Seri Zakaria Bahari, Radimax Group Sdn Bhd group chief executive Datuk Abdul Rahim Mohd Zin and former PriceWaterhouseCoopers senior partner and executive director Daruis Zainuddin.

All eyes will be on MAS’ extraordinary general meeting today, in which minority shareholders will decide whether to accept or reject its privatisation.

This article first appeared in The Edge Financial Daily, on November 6, 2014.