AirAsia X (D7, Kuala Lumpur International) has provided a detailed overview of its strategy to acquire AirAsia Bhd, the operator of AirAsia (AK, Kuala Lumpur International), and AirAsia Aviation Group, which manages the non-Malaysian AirAsia-branded airlines. The disclosure was made in a recent filing with Bursa Malaysia, outlining a comprehensive plan that includes the issuance of free warrants, a private placement, and a reduction of share capital upon completion of the acquisition.
As part of the acquisition, AirAsia X plans to consolidate seven airline entities under the AirAsia brands into a newly formed investment holding company, AirAsia Group Sdn Bhd, previously known as AirAsia Aviation Group. This strategic move aims to harness synergistic benefits through centralized decision-making and coordinated network planning, particularly in fleet management and utilization. This reorganization is anticipated to streamline operations as the new holding company has approximately 400 aircraft on order, with deliveries scheduled through 2035.
The transaction details include two conditional share sale and purchase agreements with Capital A. The first agreement, dated April 25, 2024, involves acquiring a 100% equity interest in AirAsia Aviation Group Ltd for MYR3 billion (USD629 million), which will be settled through the issuance of over 2.3 billion shares in AirAsia Group Sdn Bhd. The second agreement, also dated April 25, concerns purchasing a 100% equity interest in AirAsia Bhd for MYR3.8 billion (USD797 million), to be satisfied by assuming the debt owed by AirAsia Bhd to Capital A.
Post-acquisition, AirAsia X plans to delist and become a wholly-owned subsidiary of AirAsia Group Sdn Bhd, which will assume AirAsia X’s listing status on the Malaysian stock exchange. This reorganization requires approval from Bursa Malaysia and the shareholders.
Following the restructuring, AirAsia Group Sdn Bhd intends to issue 223.5 million free warrants on a basis of one warrant for every two shares held, conduct a private placement of shares valued at MYR1 billion (USD210 million), and reduce its issued share capital to MYR100 million (USD21 million). The proceeds from the private placement are earmarked for financing aircraft, engines, parts, paying off AirAsia Bhd’s debt, and providing general working capital.
This strategic consolidation is set to enhance operational efficiencies across the AirAsia brands, positioning the group for stronger financial performance and growth in the competitive aviation market. The process remains subject to regulatory and shareholder approval, marking a significant phase in AirAsia X’s corporate evolution.
