KUALA LUMPUR (March 2): Co-founder Tan Sri Tony Fernandes intends to monetise the AirAsia brand by injecting it into a US-based special purpose acquisition company (SPAC) — an unorthodox move that could pave the way for the lifting of Capital A Bhd out of the distressed Practice Note 17 (PN17) status.
Capital A is also selling its aviation business to AirAsia X Bhd (AAX) as the monetisation of the brand alone would not be enough to lift it out of PN17 status.
“One of the reasons why we have to sell the aviation business is to at least be clean. At least then, we can go and talk to Malaysian banks, raise equity and whatever. That is our big argument with Bursa [Malaysia]. My hands are tied, but I can’t raise capital from aviation,” says Fernandes.
In an interview with The Edge, Fernandes likens the last four years to someone being inflicted with dengue fever — always having to check platelet levels and not knowing when things will get better. For him, the ‘mist’ is now starting to clear, allowing Capital A and AAX to take flight.
What else has Fernandes planned to recast Capital A and the wider AirAsia Group?
Meanwhile, the business community and tax industry were caught off guard last week after a gazette order released showed not just an expanded scope of services to be taxed — beyond what was made known in Budget 2024 and its appendix — but also carrying an earlier than expected effective date. The gazette order caused some initial chaos among the industries.
Credit must be given to the Ministry of Finance (MOF) for promptly dealing with the matter, and openly accepting the various feedback from the industries. However, this episode has also exposed some weaknesses that need to be addressed.
What are the key issues of the service tax that still need more clarity from the MOF?
Read about this and more in the March 4, 2024 issue of The Edge Malaysia weekly. Pick up a copy at news stands.
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