Thursday 18 Apr 2024
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KUALA LUMPUR (Dec 16): AirAsia X Bhd (AAX)’s plan to restructure its debts totalling RM33.65 billion is set to be implemented after receiving court sanction.

The sanction was granted by Judicial Commissioner Ong Chee Kwan in the High Court on Thursday (Dec 16) after hearing submissions on the matter on Tuesday.

AAX had applied for the sanction of its scheme of arrangement under Section 366 of the Companies Act 2016.

The long-haul low-cost carrier was represented by lawyer S Suhendran in Thursday’s proceedings.

In a filing with Bursa Malaysia later, AAX said: “The proposed debt restructuring will take effect upon lodgement of the sanction order with the Registrar of Companies of Malaysia.”

On Nov 12, AAX held meetings with its scheme creditors to vote on its plan to restructure RM33.65 billion of debts. It received 99% support from creditors who voted.

Upon the completion of the exercise, AAX will be among the few airlines worldwide that will have no gearing and a restructured cost base that is significantly below that of its competitors.

In October last year, the carrier proposed to reconstitute RM63.5 billion of its debts into an acknowledgement of indebtedness for a principal amount of up to RM200 million by shaving off 99.9% of its issued share capital, as well as a proposed share consolidation of every 10 existing shares in AAX into one share.

The RM63.5 billion figure was reduced to RM33.65 billion after a proof of debt exercise conducted by AAX to determine and finalise the list of scheme creditors and the value of their scheme amount.

Following the debt restructuring, AAX has also proposed a renounceable rights issue of new shares to raise gross proceeds of up to RM300 million from its existing shareholders, and an issuance and allotment of new AAX shares to raise another RM200 million.

Edited ByS Kanagaraju
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