KUALA LUMPUR: Six months on, the restructuring of Malaysian Airline System Bhd (MAS) is showing steady progress for the company to return to sustained profitability, Khazanah Nasional said in statement today.
“Implementation of the 12-point MAS Recovery Plan (MRP) continues and is on track,” it said in a statement.
Critical milestones achieved include:
— RM1.38 billion was disbursed for payment to shareholders pursuant to the successful selective capital reduction and repayment exercise, as part of the first phase of conditional investment funding amounting to RM2.0 billion
— MAS shares were delisted from Bursa Securities on 31 December 2014
— The Malaysian Airline System Berhad (Administration) Act 2015 (MAS Act) came into effect on 20 February 2015, after being passed by both houses of Parliament last year
— Christoph Mueller assumed the role of Chief Executive Officer-designate of Malaysia Airlines Bhd (NewCo) on 1 March 2015. He is also a non-executive director of MAS, following his appointment on 1 January 2015
— Pending the outcome of on-going discussions for a new catering agreement, MAS and Brahim’s Airline Catering Sdn Bhd (BAC) have on 27 February 2015, entered into a Settlement Agreement (SA) for an interim period commencing 1 October 2014 to 31 March 2015. The SA provides for:
* A 25 percent reduction on monthly bills to MAS
* A settlement over disputed amounts owed to BAC, whereby MAS agrees to release to BAC a sum of RM37.95 million, which is less than the total monies amounting to RM94.03 million withheld by MAS due to the dispute.
This is the second scheduled update on the ongoing restructuring of MAS, covering the period from 29 November 2014 to 27 February 2015. The first MRP quarterly progress update was released on 28 November 2014.
The restructuring of MAS involves a “complete overhaul” to return the national carrier to sustained profitability. This entails the transformation of MAS’s corporate structure, financial position, operating performance and human capital management, guided throughout by the principles of fairness, transparency and compassion.
In the statement, Khazanah said it continues to receive interest from various entities seeking to participate in or complement the MRP. It has received 36 business proposals to-date.
“Khazanah has met and will continue to meet relevant submitting parties to discuss their proposals in detail. Khazanah conducts a rigorous evaluation process and will only evaluate and assess credible proposals with proven capability and resources. Furthermore, all proposals should not involve any break up of MAS assets integral to its function as the national carrier,” it added.
The NewCo is expected to achieve profitability three years from the delisting, ie by the end of 2017.
-NST
