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Private group makes US$2.5 billion bid for Malaysia Airlines
April 9th 2020
Malaysian sovereign wealth fund, Khazanah Nasional, has poured cold water on a proposed US$2.5 billion bid for Malaysia Airlines (MAS). Read More »
News reports this week said a Malaysian privately held firm, Golden Skies Ventures, set up by former MAS employees and other aviation professionals, had submitted an offer to acquire MAS.
The reports said Golden Skies Ventures had secured funding from a European bank and commitments from a Japanese private equity firm to invest in the airline.
"We will take about three to four months to get the long-term financing,” Golden Skies Ventures CEO, Shahril Lamin, told Reuters.
However, Khazanah managing director, Shahril Ridza Ridzuan, expressed scepticism about the proposed deal and pointed out it lacked detail about its funding sources.
“Their original proposal relied 100% on debt funding from third parties. They do not have any equity of their own,” Shahril told Malaysia's New Straits Times.
A Khazanah spokesperson told The Edge Financial Daily, which was first to report the Golden Skies Ventures bid, that "a structure that is dependent on heavy borrowings could jeopardise financial stability and add to the risk of failure in the future".
Khazanah has owned 100% of Malaysia Airlines since 2014, when it bought out minority shareholders and delisted the company from the local stock exchange, in effect re-nationalising the flag carrier.
The airline has remained mired in losses even as Khazanah mounted a turnaround that cut costs by dropping routes, rationalising the fleet and making thousands of staff redundant.
In 2019, the Malaysian government, led by then prime minister, Mahathir Mohamad, said it was exploring options for the national carrier that ranged from bringing in a strategic partner to shutting down the airline.
