AirAsia may sell leasing unit for RM4.05bil by Dec
AirAsia Bhd expects to sell its aircraft-leasing unit as early as December as the largest customer for Airbus Group SE’s single-aisle jets aims to net as much as US$1bil (RM4.05bil) from the transaction and pare debt.
Proceeds from the sale may be used to reduce debt or pay a dividend, group chief executive officer Tan Sri Tony Fernandes said in a Bloomberg Television interview.
AirAsia’s board approved the sale process for all or a substantial part of the unit, established in 2014 as Asia Aviation Capital Ltd, the carrier said in a filing on Monday.
“Depending on who’s the buyer, and there seems to be tremendous interest, we’ll likely divest all or maybe keep a minority interest for a period and sell out,” Fernandes said.
The divestment may help bolster the financials of the company, which had a total debt of RM10.7bil at the end of June. South-East Asia’s biggest discount carrier reported a 41% jump in net income for the quarter through June, benefiting from lower fuel costs and a 10% increase in passenger volumes in Malaysia.
The company named RHB Investment Bank Bhd, Credit Suisse Group AG and BNP Paribas SA as joint advisers for the transaction. The airline had received an offer valued at about US$1bil for the aircraft-leasing business, Fernandes said in May.
Strong traveller’s demand in South-East Asia and a bullish outlook in India meant AirAsia would be “surprisingly short” of aircraft and may turn to the leasing market, Fernandes said yesterday.
Shares of the carrier rose for a third day after the company said late Monday that net income rose to RM342.1mil last quarter from RM243mil a year earlier. The stock was last traded at RM3.03 before the mid-day break in Kuala Lumpur yesterday.
AirAsia agreed last month to buy 100 A321neos, adding to an order tally of 575 Airbus single-aisle aircraft, 172 of which are already in the fleet. AirAsia would start receiving the A321neos in 2019 and would take delivery of its first A320neos next month, Fernandes said.
