Malaysia's AirAsia eyes 'next level' of growth in major restructuring

Malaysian budget carrier AirAsia is undergoing a major restructuring led by its parent company, Capital A, as it starts to regain momentum following the pandemic. The restructuring of the regional airline, announced in April, would consolidate its short-haul and long-haul brands, seeking more efficient operations as the group faces growing competition. Capital A's shareholders are expected to hear the latest updates Thursday at its annual general meeting. According to the plan, Capital A would divest 100% of its shares in its two short-haul subsidiaries to a new company, AirAsia Group, for 6.8b ringgit ($1.4b). Capital A would receive AirAsia Group shares, retaining direct ownership of 18.39% in the new company. The new company would also hold shares in AirAsia X, AirAsia's sister company that offers long-haul services, and succeed AirAsia X's listing status on the local stock exchange. "I believe this proposed divestment is a unique and time-sensitive opportunity to elevate our aviation business to the next level," Capital A CEO Tony Fernandes said in a letter to the shareholders ahead of the meeting. Fernandes owns only 0.04% of Capital A shares himself but indirectly controls 24.10%. Fernandes, who recently deferred his retirement plan and signed a five-year contract to serve as Capital A CEO, emphasized that the restructuring would drive growth across Capital A's nonairline businesses like digital services and logistics. The proposals are expected to be completed by the third quarter of 2024.<br/>