Capital A To Complete Airline Disposal In October, Eyes PN17 Exit By Year-End — Fernandes
By Kisho Kumari Sucedaram
KUALA LUMPUR, Sept 24 (Bernama) -- Capital A Bhd is optimistic of completing the disposal of its airline business to AirAsia X Bhd (AAX) by October, paving the way for the group to seek removal of its Practice Note 17 (PN17) status by year-end.
Chief executive officer Tan Sri Tony Fernandes said the three conditions to facilitate the disposal include securing RM1 billion in capital, finalising six consent letters and obtaining a waiver from the Thai Stock Exchange on the general offer requirement.
“I can say again that we are making good progress there.
“The trigger point is for us to say we have completed the three conditions precedent to make the disposal. Once we announce that, the rest is just paperwork which will take three to four weeks. I’m optimistic that in October we can make the announcement,” he told Bernama in an exclusive interview on the sidelines of the ongoing ASEAN Economic Ministers’ Meeting 2025.
He said Capital A has already cleared several hurdles and is now nearing take-off in its journey towards exiting PN17.
Using an aircraft as an analogy, he said: “If I take it to an aircraft, we’re off the aerobridge, we’re on the runway, taxied and about to take off,” underscoring his confidence that the long-awaited restructuring is finally taking shape.
Fernandes said that once the transfer of the airline business is completed, Capital A will move quickly to apply to Bursa Malaysia to exit PN17 classification.
Capital A was classified as a PN17 company in January 2022 following the severe impact of the COVID-19 pandemic on air travel.
“I’m hoping that by the end of November or December, we can finally put the COVID-19 episode behind us and show that we have turned the corner,” he added.
During the pandemic which began in 2020, all borders were closed and air travel came to a complete halt, affecting all airlines including AirAsia.
Fernandes noted that the pandemic, combined with PN17, created ‘a monstrous handicap’ for the company, but expressed confidence that the latest restructuring marks a new beginning.
The disposal is also a key step towards Capital A’s longer-term ambition of creating a regional aviation group that is more streamlined and better positioned for growth.
Beyond aviation, Fernandes highlighted the group’s success in building six new companies during the pandemic years, which now form the backbone of Capital A’s diversified portfolio.
These include Asia Digital Engineering (ADE), its aircraft maintenance, repair and overhaul unit; Teleport, its logistics and cargo arm; AirAsia Move, Malaysia’s first homegrown online travel agency; Santan, an ASEAN food brand that has successfully marketed AirAsia’s in-flight meals on the ground; BigPay, its financial technology platform; and ABC, a new venture focused on branding, loyalty and digital assets.
“These companies didn’t exist before COVID-19, but today they are real businesses contributing to the Malaysian economy. People were questioning whether we would survive, and now we have built businesses that will create long-term value. The aviation group is going to be stronger,” he said.
He added that Capital A is also exploring capital market opportunities beyond Malaysia. A dual listing in Hong Kong is under consideration, with strong interest from investors in the China market.
“There is a lot of capital in that part of the world, and Hong Kong is an important gateway. In addition, American underwriters have approached us to consider listing in the United States. It’s good to be wanted again,” he said.
Fernandes said that while the immediate focus remains on completing the disposal and exiting PN17, the group’s trajectory is clear — to emerge stronger post-COVID with a more diversified base of businesses and greater regional reach.
-- BERNAMA