Wednesday 28 Feb 2024
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KUALA LUMPUR (May 25): Low cost carrier AirAsia Bhd and its long-haul sister company AirAsia X Bhd (AAX) are not considering a merger, according to the co-founders of both the low cost carriers.

At a press conference today, AirAsia Group chief executive officer Tan Sri Tony Fernandes said the merger was never brought to the board of directors, and the management remain in their belief that both short and long haul operations have to be separated.

"AirAsia's position is very clear, the board has never discussed this and there is no merger at all," he said.

"The whole purpose of setting up AAX as a separate company, is because we believe it should be separated, and 10 years on we still believe that," he added.

Last week, local media reported that there will be a possible merger between the two companies.

Today AirAsia Group's executive chairman Datuk Kamarudin Meranun also clarified that it is premature to talk about merger between the two entity, and AAX should remains focus on improving its profitability.

"In AirAsia everything is possible, but I made it very clear that we should focus on AAX's profitability strength first, and the issue has never been discussed at the board," he said.

On the AirAsia's China venture, Fernandes said it represents the first stage of establishing an airline there and the group is unfazed by concern of local airlines may lobby against the idea.

"It is the first stage and we are very proud and excited about it, there are many stages, we been through that in India, there should be something by the end of this year. I can't talk for the other airlines, but all over the world, airlines have been lobbying against us, but we still did it," he said.

Earlier this month, AirAsia signed a memorandum of understanding (MoU) with China Everbright Group and the Henan Government Working Group to jointly explore the planned establishment of a budget airline in China.

The MoU enabled AirAsia, Everbright and the Henan Government "to confirm their interest" in forming joint venture (JV) entity AirAsia (China). Henan is a province in central China.

The MoU parties planned to incorporate AirAsia (China) in Henan's capital city Zhengzhou, which is intended to be the headquarters of AirAsia (China).
At the midday break, AirAsia rose 5.78% or 17 sen to RM3.11 while AAX fell 3.33% or 1.5 sen to 43.5 sen.

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