Wirraway
20th Oct 2004, 10:29
AFP
AirAsia eyes Australia with stake in Indonesian carrier
KUALA LUMPUR : Malaysia's budget carrier AirAsia has announced plans to fly to Australia with the acquisition of a private airline in Indonesia with the launch of its initial public offering (IPO).
Pahamin Rajab, AirAsia chairman, said Jakarta would be the hub for the latest budget carrier's joint-venture after it bought PT AWAir Internasional for a token two dollars.
"We will be flying domestic routes in Indonesia and beyond. Our planes will go to places with a flying time of three and a half hours. Australia is within that flying time," he told reporters.
In its prospectus, AirAsia forecast a net profit of sme 160 million ringgit (42.1 million US dollars) for the year to June 2005.
The airline, which is offering the public shares at 1.40 ringgit each or nearly 19 times its expected earnings per share of 7.47 sen (cents), will list November 22 after Malaysia's biggest IPO this year.
Pahamin said approvals from the Indonesian government were expected to be concluded by year-end. AirAsia would hold a 49 percent stake in the business and an Indonesian partner 51 percent.
It would be similar to that of Thai AirAsia, where Thai media and telecommunications group Shin Corp. holds a controlling 51 percent stake.
Tony Fernandes, chief executive officer, in a recorded message at the IPO launch, said the Indonesian carrier would begin service at the latest in early 2005.
"We hope the operation can start by the end of the year or early next year. It is a massive market," he said.
Highlighting AirAsia's growth prospects, Fernandes said AirAsia hopes to set up similar joint ventures in China and the Philippines.
"We are in negotiations with people in China and the Philippines," he said.
AirAsia currently flies to Macau, the former Portuguese colony in southern China, from Bangkok and is expected to launch more flights to the area and India.
AirAsia, which has a fleet of 24 Boeing 737 aircraft, currently operates 322 flights a week from Kuala Lumpur International Airport to 14 domestic and eight international destinations.
Rising oil prices do not seem to worry the carrier, which said it has hedged its needs up to next June.
"We have come a long way, we do not have any specific fear," Fernandes said.
AirAsia said it had hedged fuel at 42 dollars per barrel for the six months to December and at 36.96 dollars for the second half to June 2005.
Kamarudin Meranum, executive director, told AFP that the low cost carrier does not plan to impose fuel surcharge.
"We will try to avoid that," he said while Pahamin noted the carrier would try to expand load factors and increase revenue.
AirAsia's IPO involves some 700 million shares, of which 583.76 million are new and 116.75 million are existing shares offered by its major shareholders.
The public portion of the IPO comprises 140.1 million shares, tentatively priced at 1.40 ringgit a share, while the institutional portion of 560.41 million shares will be price through a book-building exercise.
Based on the indicative price of 1.40 ringgit each, Air Asia said it will raise gross proceeds of 864.01 million ringgit.
AirAsia plans to use the funds from the IPO to increase its fleet to 80 aircraft with Boeing and Airbus competing for the business.
Kamarudin said AirAsia had conducted a preliminary study on both and a decision could be made early 2005 after it receives a formal proposal from the two manufacturers.
- AFP
===========================================
AirAsia eyes Australia with stake in Indonesian carrier
KUALA LUMPUR : Malaysia's budget carrier AirAsia has announced plans to fly to Australia with the acquisition of a private airline in Indonesia with the launch of its initial public offering (IPO).
Pahamin Rajab, AirAsia chairman, said Jakarta would be the hub for the latest budget carrier's joint-venture after it bought PT AWAir Internasional for a token two dollars.
"We will be flying domestic routes in Indonesia and beyond. Our planes will go to places with a flying time of three and a half hours. Australia is within that flying time," he told reporters.
In its prospectus, AirAsia forecast a net profit of sme 160 million ringgit (42.1 million US dollars) for the year to June 2005.
The airline, which is offering the public shares at 1.40 ringgit each or nearly 19 times its expected earnings per share of 7.47 sen (cents), will list November 22 after Malaysia's biggest IPO this year.
Pahamin said approvals from the Indonesian government were expected to be concluded by year-end. AirAsia would hold a 49 percent stake in the business and an Indonesian partner 51 percent.
It would be similar to that of Thai AirAsia, where Thai media and telecommunications group Shin Corp. holds a controlling 51 percent stake.
Tony Fernandes, chief executive officer, in a recorded message at the IPO launch, said the Indonesian carrier would begin service at the latest in early 2005.
"We hope the operation can start by the end of the year or early next year. It is a massive market," he said.
Highlighting AirAsia's growth prospects, Fernandes said AirAsia hopes to set up similar joint ventures in China and the Philippines.
"We are in negotiations with people in China and the Philippines," he said.
AirAsia currently flies to Macau, the former Portuguese colony in southern China, from Bangkok and is expected to launch more flights to the area and India.
AirAsia, which has a fleet of 24 Boeing 737 aircraft, currently operates 322 flights a week from Kuala Lumpur International Airport to 14 domestic and eight international destinations.
Rising oil prices do not seem to worry the carrier, which said it has hedged its needs up to next June.
"We have come a long way, we do not have any specific fear," Fernandes said.
AirAsia said it had hedged fuel at 42 dollars per barrel for the six months to December and at 36.96 dollars for the second half to June 2005.
Kamarudin Meranum, executive director, told AFP that the low cost carrier does not plan to impose fuel surcharge.
"We will try to avoid that," he said while Pahamin noted the carrier would try to expand load factors and increase revenue.
AirAsia's IPO involves some 700 million shares, of which 583.76 million are new and 116.75 million are existing shares offered by its major shareholders.
The public portion of the IPO comprises 140.1 million shares, tentatively priced at 1.40 ringgit a share, while the institutional portion of 560.41 million shares will be price through a book-building exercise.
Based on the indicative price of 1.40 ringgit each, Air Asia said it will raise gross proceeds of 864.01 million ringgit.
AirAsia plans to use the funds from the IPO to increase its fleet to 80 aircraft with Boeing and Airbus competing for the business.
Kamarudin said AirAsia had conducted a preliminary study on both and a decision could be made early 2005 after it receives a formal proposal from the two manufacturers.
- AFP
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