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Low-cost, long-haul carrier AirAsia X has run out of money and needs to raise up to MYR 500 million ($ 120.60 million) to restart the airline. This was revealed by the vice president of the company Lim Kian Onn.
The Malaysian airline, the long-range arm of AirAsia Group, said this month that it wanted to restructure MYR 63.5 billion ($ 15.32 billion) of debt and cut its share capital by 90% to continue as a going concern.
“We have run out of money. Obviously, banks will not finance the company without shareholders, both old and new, bringing in new shares. So a prerequisite is new capital, ”Lim said. He added that the airline had actual liabilities of MYR 2 billion (USD 0.48 billion), with the higher of MYR 63.5 billion (USD 15.31 billion), including all lease payments for the next eight to 10 years and their large order for Airbus SE aircraft and engine maintenance contracted with Rolls-Royce Holdings.
“If we find MYR 300 million (USD 72.32 million) in new shares, then the shareholders funds are MYR 300 million (USD 72.32 million) upon restarting the business and if we can borrow MYR 200 million (USD 48, 21 million), we feel we will have a good platform to start over, ”he told The Star newspaper. Lim said AirAsia X also needed to convince its lessors of its business plan, adding that an unidentified lessor recently recovered one of the airline planes to turn it into a freighter.
The airline plans to liquidate its small Indonesian-based airline and has fully put its stake in Thai AirAsia X on its books, and the Thai airline is not part of the restructuring plan, Lim told the newspaper.
Rival Malaysia Airlines is also in financial trouble, but Lim said there would be no good results if it seeks to merge two airlines in dire straits.
(Source: Reuters)
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