Published on Monday, October 19, 2020

AirAsia X: 'We have run out of money'

AirAsia Group's long haul arm AirAsia X says the cash has dried up and needs MYR500 million ($120million) to restart the business.


It recently said it plans to restructure $15.32 billion of debt and reduce share capital by 90% to stay in  business.


It is struggling to convince lenderss and needs fresh funds.


"We have run out of money. Obviously, banks will not finance the company without shareholders, both old and new, putting in fresh equity. So, a prerequisite is fresh equity," Deputy Chairman Lim Kian Onn told the Star newspaper.


He says its actual liabilities are MYR2 billion with the remaining debt made up of lease payments due over the next decade and an Airbus aircraft order.


It also plans to liquidate the Indonesia AirAsia X airline and has written down its stake in Thai AirAsia X.


The liquidation will not affect the main Indonesia AirAsia business.


Lim said AirAsia X also needs to get aircraft lessors on side to support the business plan.


If it can secure fresh funds 'we feel that we will have a good platform to start all over again, Lim said.


In a response to a question whether AirAsia should integrate with cash-strapped Malaysia Airlines, Lim said there would be 'no good outcome' from a merger.


 


Written by Ray Montgomery, Asia Editor

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