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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
TravelMole Editorial Team
Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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