KUALA LUMPUR (Oct 30): Capital A Bhd (KL:CAPITALA) chief executive officer Tan Sri Tony Fernandes told a press conference that he expects the group to exit Practice Note 17 (PN17) status in December, as its airline consolidation under AirAsia X Bhd (KL:AAX) moves forward.
Capital A said all conditions for its aviation restructuring have been met or waived as of Wednesday, allowing it to proceed to the final steps of its regularisation plan, as well as its capital reduction and distribution.
The group is targeting to make its PN17 upliftment application in December, Fernandes said. “We target PN17 exit by Dec 31,” he said.
“We’re off the gate, moved to the runway, and now ready to take off,” Fernandes said.
Capital A and AAX have cleared the final hurdle in their airline consolidation after AAX and its Thai partner agreed to buy out minority shareholders of Asia Aviation PCL, the operator of Thai AirAsia, instead of seeking a waiver.
It took almost a year and a half — 18 months — for Capital A to complete the deal.
The group first unveiled the plan for AAX to acquire AirAsia Aviation Group Ltd (AAAGL) and AirAsia Bhd (AAB) in April 2024, to consolidate all short- and medium-haul AirAsia carriers under a single listed entity.
Meanwhile, AAX’s RM1 billion private placement, which is tied to the deal, is being finalised and details of the investors will be announced in due course, Fernandes noted. Commitment letters for the exercise have already been secured.
With the airline consolidation now “completed”, there are two separate entities: the non-aviation Capital A and the aviation business under AAX, which will be renamed AirAsia Group.
Without the airline business, Capital A will comprise digital and services ventures such as maintenance, repair and operations (MRO) unit Asia Digital Engineering (ADE), Teleport (logistics), AirAsia Move (travel platform), Abc (brand licensing and digital IP), Santan (F&B) and BigPay (fintech).
AirAsia Next listing on Nasdaq, aviation expansion
With its PN17 troubles soon to be behind it, Fernandes said Capital A can now focus on expanding its non-aviation businesses.
He said the group will now revisit its previously mulled plan to list Abc on the Nasdaq. For the planned listing, Fernandes said Abc will be renamed AirAsia Next and will have BigPay injected into the company.
“We’ve started the process for the listing of Abc (AirAsia Next) on the Nasdaq, which we had planned a few years ago,” Fernandes said, adding that the idea was shelved as Capital A focused on its restructuring exercise.
Meanwhile, at AirAsia Group, Fernandes said the aviation business will focus on getting its 15 planes that have been grounded since Covid-19 into the sky by the end of this year.
He added that the group is also placing its expansion plan back on track — to grow its fleet from 255 aircraft to over 600 within ten years’ time. Passengers carried are targeted to increase from 68.8 million to 155 million, while destinations are aimed to rise from 143 to 175.