AirAsia MAS together after all. [Archive]

scandicstar

8th Aug 2011, 17:17

These are some of the analysis by Anonymous

UNQUOTE :

Anonymous said... Rather than engaging, the glib-talking TF, MAS would be better advised to imitate his model of hub and spokes using Firefly for short haul regional and MAS for long haul international. And of course reining in costs, avoiding big capital outlays or commitments and optimising aircraft utilisation and turn around time by route rationalisation and improved efficiencies, staff attrition and leveraging on technology would not be harmful for growth and profitably prospects in the least. As for TF being a saviour, forget it and here are some reasons why! No, I am not trawling the Christo route but cant help feeling that in Idris Jala and TF we have two Christo wankers with enough self motivation to drag MAS through the mire just to spite Muslim faces....(ROFL). Anyway, about Air asia................

1.As of the 1st Quarter of 2011, Air Asia (AA) debts amounted to 7.7 billion with cash balances amounting to 1.7billion.

2. In August 2010. AA announced a deferment of their proposed aircraft purchases but sometime in June 2011 they reversed their decision and proceeded to place an order for an additional 200 new aircrafts at the Paris Air Show.

3. As of 31 March 2011, based on data from their 1st Quarter report, AA’s capital commitments stood at RM 19 billion. With the above announcement, an additional RM 54 billion will be added as Capital Commitments as implied in this article:
AirAsia inks US$18.5b deal for 200 A320neo aircraft (http://biz.thestar.com.my/news/story.asp?file=/2011/6/24/business/8966621&sec=business)
the proposed CC of roughly 75 billion will be spread over a 15 year period ending 2026. In other words,AA has to ratchet up its earnings to an average of 5 billion per annum to meet its future dues. From 2006 to 2010. AA’s revenue grew by 10 fold from 110 million to roughly 1.1billion, an average growth of RM 200 million per annum.

4. Its cash trove rose 6 fold from approximately 300 million to 1.7 billion but its debts skyrocketed from 1.05 billion in 2006 to 7.7 billion in 2010, an increase of 700%. One gets the ghastly feeling that this is a debt burden that is spiralling out of control.

The schedule for the aircraft delivery is as follows with the Neo being received from 2016 onwards:
2012 = 14
2013 = 13
2014 = 18
2015 = 19
2016 = 19 (4 Neo)
2017 = 14
2018 = 18
2019 = 19
2020 = 20
2021 = 21
2022 = 23
2023 = 24
2024 = 24
2025 = 24
2026 = 9

To compound the issue, the world economy including Asia’s will be into another maelstrom and air travel will invariably be hit:
Airline Earnings Showing First Drop in Eight Quarters, IATA Says (http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2011/08/02/bloomberg1376-LPCGED6TTDS201-7DB69T4DDVIF7J1IS4SUCOAULO.DTL)

and we probably will have a white elephant in NS soon give or take three years and another one of my dire predictions I made in when commenting on AA in 2009 materialises.

Of course AA can cancel orders but contract penalties will be onerous. In any case, TF is betting on the assumption that being a big borrower will shield him from foreclosure as banks will be leery of bearing heavy losses! bUt then a sizeable chunk of those loans are being held by Malaysian banks and in the worst case scenario, the government and the taxpayer will have to pick the tab to avert a financial meltdown cascading down the AA slope.

This smells like a bailout.

But the real question is for whom.

MAS might not be performing financially but Air Asia debt is increasing. Air Asia is the one in serious need for cash to pay for their 200 airplane purchase and to pay for the aircraft deliveries that have been silently deferred several times.

This is not a swap but more a buying into. The purchase of the 20% stake in Air Asia will cost more than twice the money to buy a similar slice of MAS. A 20% stake in MAS is a bigger voice on the board than a 20% stake in Air Asia.

Rationalization my foot. This can be done without an equity swap.

This stinks.

A disaster in the making. The AA bubble will burst soon and with it Malaysia will go down the drain when the Government will have to pick up the tab due to massive loan default by AA. The merger is not in the interest of the nation. Why can't the Pee Em see that? Maybe he is in it too together with the previous Pee Em?

Dumb deal set by dumber people on a nation of dummies.

the truth is gov now dont have money. some money the gov have, probably go to defense purchase for the nation 'security'.

so instead of keeping share in mas, better stick the dick into airasia, at least gov get couple of mills each year, enough to cover the karipaps and meehon goreng at each departments meetings everyday.
(http://www.rockybru.com.my/2011/08/mas-and-air-asia.html?showComment=1312766601711#c5611397072640528190)
(http://www.blogger.com/delete-comment.g?blogID=28452020&postID=5611397072640528190) http://img1.blogblog.com/img/blank.gif:sad: another :sad: and :(day.

roxar

8th Aug 2011, 18:39

1st rumours bout moving to Jakarta..
Now MAS+AK=MASAKlah!..
interesting.......
wonder what will happen to MAS..
:}:ugh:

babasinkeh

8th Aug 2011, 22:58

Wow! Suddenly we finally have some response to anything to do with MAS. Well MAS people are still in denial and in lala land. The writing was on the wall ages ago. As usual they sing the government tune, with their blinkers on and just ignore whatever postings on MAS hoping to kill all those threads on MAS silently! When I ask them about stuff about MAS on forums like Pprune and ********** they just brushed it off; preferring their in-house MAPA forum which is no better than the ameno/mca/mic dominated fora.

scandicstar

8th Aug 2011, 23:24

excerpt from YB ;

UNQUOTE

YB Senator Datuk Idris Jala: Is this AirAsia/MAS share swap an indirect bailout?

August 7, 2011 by weechookeong (http://weechookeong.wordpress.com/author/weechookeong/)

The MAS/AirAsia share swap deal: “AirAsia’s Fernandes to gain 20% stake in national carrier”. The front page sources story in the Star today. “Fernandes declined to comment when asked about the deal.”, so says The Star. This was not what we know of Tony Fernandes, who loves publicity and is well known to jump on anything to say his bit to enhance his image. Read HERE (http://weechookeong.wordpress.com/?s=airport+tax+debt+airasia).
This “share swap deal” is a joke of the century. It would appear that now AirAsia, which has been known to have the special “abilities” to owe airport taxes to the tune of more than RM125 million since it inception until 2010, has been made out to look like a white knight for MAS.
THE PERTINENT QUESTION NOW IS: IS AIRASIA BAILING OUT MAS OR MAS HAS BEEN USED AS A VEHICLE TO BAIL OUT AIRASIA? Your views please, YB Senator Datuk Idris Jala, the former CEO of MAS, on this issue.
Please read further. I leave it to you to judge.
During the settlement of the outstanding airport tax debts, the MAB, which is also part of the Khazanah Bhd’s setup, also gave a special discount of some 30 % to AirAsia when MAB should have demanded for full payment with interests because the passengers paid these airport taxes. The discount should be refunded to the passenger and not given to AirAsia. This is common sense but not to the Khazanah Bhd’s officials.
After I was elected to Parliament, I have brought up the issues of airport tax debts owed by AirAsia many times in Parliament. Strangely, prior to my admission to Parliament no opposition Members of Parliament have ever brought up the AirAsia’s airport tax debts and other issues relating to Airasia in Parliament. Was it a case of not wanting to upset the then PM, who was on a honeymoon mode?

These outstanding airport taxes were lawfully due to MAB. Prompt payment of airport taxes will not only benefitted MAB but ultimately Khazanah Bhd. But Khazanah Bhd felt otherwise. It is unheard of in other countries where an airline, budget or otherwise, has been given the special “right” to owe airport taxes for more than 9 years, when all airlines are the collecting agent of such taxes for the authority. I am certain that if any other airlines were to owe airport taxes for a month, its landing right would have been withdrawn by a stroke of a pen. But in the case of AirAsia, it was rewarded with a discount! No wonder Tony Fernandes has been hailed as “the best CEO” and recently conferred with the title of Tan Sri!
AirAsia has been given the special rights to owe airport taxes but to compete with MAS in most, if not all of the profiting matured routes like London, several cities in India, Australia, Japan and etc. It must be noted that MAS has expanded enormous efforts not to mention costs to promote and nurture all the routes to make them profitable. MAS was like a boxer with its hands tied behind and put in the boxing ring to fight.
AirAsia had demanded and given 32 destinations to fly by Ministry of Transport and only to fly 16 profitable routes. Recently AirAsia has reduced its profitable destinations from 16 to 13. It has ceased to fly to the 3 destinations, presumably must be due to non-profitable. I believe that the dropping of the 3 destinations was made without seeking the approval from the Ministry of Transport. What is the Minister of Transport doing about this? Since AirAsia is only interested in flying to the 13 destinations, it is the duty of the Minister of Transport to immediately withdraw the remaining 19 destinations.
Whereas MAS had to fly all routes granted regardless of profitability, as MAS, is our national carrier and the country ambassador, keep our presence in other countries. Whereas AirAsia enjoys the special “rights and privileges” to owe airport taxes at one time and now pick and chose its destinations.
A few years ago, during the honeymoon period under Badawi, Tan Sri Tony Fernandes and his boys (under the outfit known as FAKS) fought so hard and were granted the right to take over the RAS (Rural Air Services) in Sabah and Sarawak from MAS. MAS gladly hand over the RAS with 7 airworthy aircraft and FAKS was handed a handsome subsidy of about RM65 million to carry out the RAS for several but only to cease the operation less than a year due to its inability to provide proper services and too many public complaints from Sarawakians and Sabahans including the East Malaysian politicians.
FAKS conveniently dumped RAS back to MAS and MAS, the whipping boy as usual was forced to resume the national service to provide RAS to our East Malaysians brothers and sisters. When taking over the fleet of aircrafts from FAKS, MAS discovered that all the aircrafts were un-airworthy and one of them was cannibalised for spare parts. MAS, at its own costs, spent RM35 million to put the aircraft in operation to carry out its national service to the nation and FAKS was not asked to be responsible for the sorry state of the aircrafts or pay to MAS the RM35 million expended to put the aircraft in the state of airworthiness. At the same time, FAKS was rewarded with the subsidy of RM65 million for providing the poor RAS for a few months and ceased operation prematurely! This is the “national services” provided the parties concerned.
I believe that this so-called share swap must be more than what has transpired in the Star quoting the main source from Malaysian Insider, the friendly news portal for AirAsia.
PLEASE TAKE NOTE: “AIRASIA HAS PURCHASED 200 AIRBUS A320 AIRCRAFT EARLIER THIS YEAR WITH THE OPTION TO BUY ANOTHER 100, WHILE MAS WAS SET TO MAKE A DECISION ON THE REPLACEMENT AIRCRAFT FOR ITS BOEING 747 AND 777 FLEET, WHICH IS MORE THAN 20 YEARS OLD.” so says The Star.
To date, AirAsia only flies to 13 destinations and MAS easily triple the destinations of AirAsia or more than that. So judge for yourself who needed the aircraft! Perhaps penalty time is up. So panic button has been pressed!
Everyone should now be asking:
Who is or was the agent for Airbus in Malaysia when AirAsia or Datuk Tony Fernandes, as he then was, when signed the agreement to purchase the 200 Airbus aircraft a few years ago?
Why AirAsia had to delay the deliveries of the Airbus when AirAsia was supposed to take delivery of it on a monthly basis?
Now according to the The Star report, Airasia has purchased 200 aircraft and MAS was to make a decision on replacement aircraft. I thought that MAS has already ordered several Boeing A380 and the delivery of them earlier next year. A380 aircraft will be in operation in April 2012.
YB Senator Datuk Idris Jala, the former CEO of MAS, should stand up now and be counted on the issue of this so-called share swab. Lets hope that Datuk Idris Jala will make his position as the head of NKRA meaningful by issuing a statement on this.
Now a share swap and gain a 20% stake in MAS. What a joke! Please wake up Khazanah Bhd. Please take care of our national carrier and other GLCs. Malaysians would not want to see Khazanah Bhd realizing the Malay proverb of “HARAPKAN PAGAR, PAGAR MAKAN PADI!”
I am wondering who is the actual owner of AirAsia!
Before I sign off this article, I would like to point out that Datuk Omar Ong, who was known to be closed to the famous former 4th floor, was recently appointed to the Board of AirAsia. Read HERE (http://www.bonology.com/2011/03/will-air-asia-get-their-ong-after-this.html), Since then AirAisa has been flying higher and higher. Hopefully it was by chance! Last month, AirAsia got another 5 new destinations including Jeddah, one of the most profitable destinations. It is hoped that it was also by chance that this share swap suddenly emerged.
I shall definitely take this up and do what I can to get to the bottom of this “SHARE SWAP JOKE OF THE CENTURY” in October, when Parliament will be in session.

TAKBOLEHHARAPLAND

Kal Niranjan

8th Aug 2011, 23:38

Air Asia X now have 2 ex Mapa presidents who must be giving tf " good " advice. Remember the pariah latuk g string has got " tentacles " in Mapa and we can all surmise that the 2 latuks tf and pariah singh are gonna do MAS in especially with info gathered through Mapa. Conspiracy theory? Just watch and see.

mohdkarta

9th Aug 2011, 04:25

Ah, looks like all harta melayu kembali nusantara. Air Asia, if it does help strip off MAS assets, will be rich pickings for our bomoh businessmen who help protect Malaysian politicians and tycoons with our native ILMU.

Coming back to the story about the 2 exMapa presidents in Air Asia X...both were allegedly dismissed from previous companies for sexual harassment. Are those allegations true?

CAPTAIN WOOBLAH

9th Aug 2011, 07:54

Well I did mention this years ago. It took longer than I expected because the thieves in the den covered their tracks with taxpayers money brilliantly. But alas Pandoras box is surely but slowly opening. It will be very interesting to see how the bailout pans out.

Wooblah.

ipohmali

9th Aug 2011, 09:46

Latest developments :

Azmil out of MAS in share swap with AirAsia (http://malaysia-today.net/mtcolumns/newscommentaries/42694-azmil-out-of-mas-in-share-swap-with-airasia)

NEWS/COMMENTARIES (http://malaysia-today.net/mtcolumns/newscommentaries)

Tuesday, 09 August 2011

http://img577.imageshack.us/img577/1501/masairasiax.jpg
(The Malaysian Insider) - MAS managing director Tengku Datuk Azmil Zaharudin lost his job today after the airline’s shareholders finalised a share swap with Asia’s largest low cost carrier, AirAsia.

Also Air Asia and MAS shares trading temporarily suspended. Getting curiouser and curiouser OR BECOMING BLATANT OBVIOUS THAT WE ARE ONCE AGAIN ROBBED KANGKANG!

nasree

9th Aug 2011, 10:25

Some months ago over teh halia and the usual goodies this possibility was brought up with some seemingly level headed MAS pilots...well total denial of this can ever happen, so confident were they and they are 100% solid behind their Mapa gods and MAS bomohs. We the traitors are really pengkhianats daring to bring up such ludicruous conjectures. As someone alluded to a few times, MAS is run exactly like the corrupt BN gomen. All the fellas sitting in management, MASEU, Mapa, Air Asia, kementerian pengangkutan, MAB, khazanah, etc are all corrupt to the core.

OKhalsa

9th Aug 2011, 20:10

Ladies & gentlemen, try as you may it looks like you ain't gonna get even a squeak out of MAS pilots. Heads in the sand, mapa is super great and all posters about the mothership on pprune are deemed to be uninformed trolls. That's their rationale; they love everything in-house despite a history of incestuous relationships between the in-house union, associations and the management. Those who had seen how the mapa exco members behaved and operated decades ago know their inner desires, grandiose plans and general competence.

The cosy relationship of tf with the crooks in our governing establishment can only mean bad things for MAS. No amount of positive spin can detract from notion that this a blatant bail out plan for Air Asia.

babasinkeh

10th Aug 2011, 18:14

Here is my little squeak, albeit taken from somewhere else :

Don't cry for me Mas Malaysia truly Air Asia!

Seriously read this and see if you can find any positive things to say:

Azmil out of MAS in share swap with AirAsia

UPDATED @ 11:15:05 PM 09-08-2011
By Jahabar Sadiq and Lee Wei Lian
August 09, 2011

http://www.themalaysianinsider.com/images/uploads/2011/august/09/m_airasia5.jpg (L-R) Datuk Kamarudin Meranun, Tan Sri Azman Mokthar, Tan Sri Md Nor Yusof, Tan Sri Tony Fernandes, Mohd Rashdan Mohd Yusof and Datuk Sri Nazir Razak at the MAS-AirAsia signing ceremony today. — Picture by Jack Ooi

KUALA LUMPUR, Aug 9 — MAS managing director Tengku Datuk Azmil Zaharudin lost his job today after the airline’s shareholders finalised a share swap with Asia’s largest low cost carrier, AirAsia.
The Malaysian Insider understands that an executive committee led by Tan Sri Md Nor Yusof will manage the state carrier until a new CEO is appointed while day-to-day operations will be handled by Khazanah Nasional Bhd executive director and MAS board member, Mohd Rashdan Mohd Yusof.
The executive committee will comprise of Datuk Mohamed Azman Yahya, Rashdan, Tan Sri Tony Fernandes and Datuk Kamarudin Meranun.
Azmil will join Khazanah as an executive director effective September 12, 2011.
Under the share swap, AirAsia’s main shareholder Tune Air Sdn Bhd will swap 10 per cent stake in the budget carrier for 20.5 per cent share of the ailing flag carrier in the agreement called a “Comprehensive Collaboration Framework.”
Before the share swap, Tune Air was the biggest shareholder in AirAsia with 26.28 per cent stake while Khazanah held a total of 69.33 per cent share of MAS.
The MAS board will also see some new faces, namely Land & General Bhd founder, Tan Sri Wan Azmi Wan Hamzah, former IJM chief executive Datuk Krishnan Tan, Astro chief executive Datuk Rohana Rozhan and David Lau from Shell Malaysia, who will act as independent non-executive directors.
Fernandes and Kamarudin, on the other hand, have been appointed as non-independent non-executive directors of MAS.
Rashdan, popularly known as Danny, was part of the BinaFikir consultancy that engineered the wide asset unbundling (WAU) restructuring that made MAS a virtual airline in 2002. BinaFikir was then led by Tan Sri Azman Mokhtar, who is now managing director of Khazanah, the majority shareholder in MAS.
CIMB Bank was appointed as advisor to the deal.
CIMB Group CEO Datuk Seri Nazir Razak said at the press conference that the collaboration would align shareholders and create synergies between the two airlines.
He added, however, that there is no commitment to collaborate until an analysis is completed to ensure that the deal does not contravene any global anti-trust laws.
The collaboration agreement comes into immediate effect for a period of five years with an option for a further five years.
The two airlines will also share common directors as Tan Sri Tony Fernandes, Datuk Kamarudin Meranun, Azman and Rashdan will be members of both boards.

http://www.themalaysianinsider.com/images/uploads/2011/august/09/m_airasia6.jpg Tony Fernandes called the deal “something very special” today. — Picture by Jack Ooi

Malaysia Airlines chairman Nor Yusof said that no timeframe has been determined to appoint a new CEO but a search is ongoing.
He said that Tengku Azmil was being replaced as CEO as they were looking at a new approach for the national carrier and therefore needed a new team.
A joint collaboration committee will be chaired by Azman while an advisory panel chaired by former prime minister Tun Abdullah Ahmad Badawi will be set up to ensure that all parties operate in the interest of the public and consumers.
Fernandes said that the tie-up between the two airlines was a “fantastic step forward.”
“I assure the Malaysian public that this is something very special,” he said.
“I hope you (Malaysia Airlines staff) will now take down my picture with all the darts on it,” he quipped in reference to the traditional rivalry between the two carriers.
He added that the airlines would not scale back their respective plans for expansion.
Azman said that the two airlines will remain separate with separate brands and cultures.
“The idea is for the two airlines to focus on core competencies,” the Khazanah managing director said.
Nazir said that the swap price used was the closing prices for the shares on August 5 which gives a swap ratio of 2.05.
“It is a coincidence as the deal was also done at 2.05 am at One World Hotel (in Bandar Utama) on Sunday,” he revealed.
Under the deal, MAS shareholders would get one AirAsia warrant for every 30 MAS shares while AirAsia shareholders would get one MAS warrant for every 10 AirAsia shares.

Sireh

10th Aug 2011, 20:11

Looks like crown jewel was sold for a song! 10% for 20.25%? Aiyoyo, what a deal, what a STEAL!

ipohmali, you got it right. We 're robbed and rogoled TERKANGKANG!:{:{:{

jandakotcruiser

11th Aug 2011, 00:00

As a former fair dinkum at MAS, pretty disappointed at this turn of events. Time for a bit of gumption guys! When I was in KCH they had the Ngapsayout spirit. Replicate that!

Virtual Reality

11th Aug 2011, 04:59

With this announcement, the plot thicken ...........

Putrajaya directs GLCs, Danaharta to drop all claims against Tajuddin Ramli

By Leslie Lau

KUALA LUMPUR, Aug 11 — Putrajaya has directed all government-linked companies, including Malaysia Airlines, and the national debt restructuring company Danaharta, to cease all civil suits against Tan Sri Tajuddin Ramli, the former chairman of the national carrier and protege of Tun Daim Zainuddin, according to documents obtained by The Malaysian Insider. In a letter sent this month to the GLCs and Danaharta by Minister in the Prime Minister’s Department Datuk Seri Nazri Aziz, the GLCs and Danaharta were informed that the Finance Ministry had agreed to settle all outstanding civil suits against Tajuddin, a poster boy of Tun Dr Mahathir Mohamad’s plan to groom Bumiputera entrepreneurs.

“This is to inform you that the government of Malaysia and the Finance Ministry has agreed to settle all civil claims against Tan Sri Dato Tajuddin Ramli and others to be withdrawn immediately in view of the fact that the government and the Finance Ministry have agreed that the said cases will be settled out of court.

“For your information the government has given me the mandate to act for the government in this matter,” Nazri said in the letter sighted by The Malaysian Insider.

At least one government agency is expected to withdraw its claims against Tajudin in court today.

Nazri’s letter also directs the lawyers acting for the GLCs and Danaharta to hand over their cases to the firm of Hasfarizam Wan and Aisha Mubarak, a known Umno lawyer.

But the minister made no mention of the terms of settlement with Tajuddin.

Tajuddin was a protege of Daim, the close friend of Dr Mahathir and ex-finance minister who was the architect of the now discredited policy of nurturing a class of Malay corporate captains on government largesse.

Individuals such as Tajuddin, Tan Sri Halim Saad and others flew high in the 1990s but their true mettle was tested during the Asian financial crisis. Nearly all of them fared poorly.

The Najib government’s move to settle all outstanding claims against Tajuddin appears to be an attempt to wipe the slate clean in a financial saga that goes back decades to the height of Dr Mahathir’s administration.

First police report in 2002

MAS had first lodged a police report against Tajuddin in 2002 for allegedly causing the flag carrier to suffer losses in excess of RM8 billion. Tajuddin was the executive chairman of the airline from 1994 to 2001.

According to a report to the Malaysian Anti-Corruption Commission (MACC), a major contributor to the record losses under Tajuddin was the relocation of MAS’s cargo operation in Amsterdam and Frankfurt to a single hub in Hahn, Germany, where the airline was forced to enter into a disadvantageous aircraft lease contract with a company, which was later linked to Tajuddin’s family.

The new cargo hub operation had caused MAS to suffer losses of between RM10 million and RM16 million a month before the project was terminated after the government regained control of MAS in 2001.

The termination resulted in a RM300 million arbitration claim against MAS by the company.

MAS has had a turbulent past decade after the government bought back the airline from the former corporate high-flyer at RM8 per share or about double the market price at the time.

The airline was at the time saddled with a debt reported to be RM9.5 billion.

It then had its books cleaned up in 2002 under the wide asset unbundling (WAU) exercise that was engineered by the BinaFikir consultancy, then led by Tan Sri Azman Mokhtar.

In 2009, Danaharta and two of its subsidiaries won a RM589.143 million suit against Tajuddin. The case arose after the tycoon executed a facility agreement on July 13, 1994 to borrow RM1.792 billion from a group of syndicated lenders to finance the purchase by him of a 32 per cent stake in MAS.

However, from 1994 to 1998, he failed to service the original loan, causing it to become a non-performing loan (NPL).

Posted Image Daim was the architect of the now discredited policy of nurturing a class of Malay corporate captains on government largesse. — File picIn 1998, Danaharta acquired the NPL from the lenders but Tajuddin also failed to settle his debts to Danaharta until it was in default of RM1.41 billion as at Oct 8, 2001.

As part of a settlement agreement, Tajuddin was to pay RM942 million in four instalments over three years and that he was permitted to redeem his charged shares at a minimum price per share.

Tajuddin, however, defaulted in the payment of the quarterly interest payable under the settlement agreement and on April 27, 2002, the plaintiffs terminated the settlement agreement and demanded RM1.61 billion from him.

On April 29, 2002, Danaharta, together with its subsidiaries Danaharta Urus Sdn Bhd and Danaharta Managers Sdn Bhd, sold part of the charged shares consisting entirely of Technology Resources Industries (TRI) shares at RM2.75 per share, resulting in total proceeds of RM717.39 million.

As at December 31, 2005, the amount outstanding was RM589.14 million and on May 11, 2006, Danaharta and the subsidiaries commenced action to recover the money.

Tajuddin alleged, in his affidavit, that he was directed by Dr Mahathir and Daim in 1994 to buy a controlling stake in Malaysia Airlines to bail out the government.

Forced “national service”

Tajuddin claimed that his purchase was a forced “national service”, disguised as an arm’s length commercial deal, because the government wanted to appease the investment community and the public.

Dr Mahathir denied in his autobiography published this March that he and Daim had forced Tajuddin to bail out MAS in 1994 for RM1.8 billion.

Instead, Tajuddin was “elated over his purchase” of the national carrier, the former prime minister said in the book titled “A Doctor in the House: The Memoirs of Tun Dr Mahathir Mohamad”.

“Recently Tajuddin accused me and Tun Daim of forcing him to buy shares and a controlling interest in MAS. I have checked newspaper reports of the time. Far from feeling coerced, it is obvious that Tajuddin was elated over his purchase.

“He wanted to swap his Malaysian Helicopter shares (a company with two aircraft) for MAS shares (a company with well over 60 aircraft). The government rejected his plan and asked that he pay in cash instead, which forced him to borrow RM1.8 billion.

“He was therefore not coerced by the government to buy the shares, but was forced by his own modest collateral to borrow heavily,” Dr Mahathir wrote.

Tajuddin had claimed that Dr Mahathir and Daim had forced him to buy a 32 per cent stake in MAS from Bank Negara at RM8 per share instead of the market price of RM3.50 to bail out the central bank which was hit by multi-billion ringgit foreign exchange losses.

Tajuddin had said that he did not want to buy the MAS stake as he was worried about financial losses but agreed to do it because it was a directive and also because the government had assured him that he would be protected from financial losses and liabilities.

“I do remember wondering how Tajuddin would be able to buy the airline and when I asked Tun Daim, he explained that Tajuddin’s telecommunications company Celcom (Malaysia) Berhad was doing well,” Dr Mahathir wrote.

VR :cool:

Amitabh Belacan

11th Aug 2011, 06:46

Ha ha he woe boo hoo hoo:{:{ There goes any accountability. There goes my 20 over years of hard work for my national flag carrier now worth less than half that of an LCC.:ugh::ugh:

The mere mention of the kerala kaka kutty really piss me off. His recent manoevres are pure evil and diabolical. He has flogged off his holdings in Tanjong and now messing around MAS using Air Asia. Funds are squirelled overseas via YTL; oh dear all the crooks are preparing for the day when things go pear shape for their ruling regime.

bungacengkeh

11th Aug 2011, 18:39

Diamlah keling; all snakes of the same skin always rob us blind. tf, rat, ak, all the mamaks. Wtf, MAS is still paying good money.

gerago

11th Aug 2011, 20:50

Now guys, look back at the recent events tying up the pm, his regime, tf and dr madey kutty. A lot of horse trading, posturing and wheeling dealing going on to hoodwink the still gullible Malaysians besides getting ill gotten gains out should the regime implode. tf has been rumoured to be some kind of opus dei operative and the recent najib meeting with the pope are red flags. All of us were hoodwinked into thinking that the acts of violence against churches the previous two years were some simple minded " ketuanan melayu/islam " acts of intimidation against Christians/catholics. Actually you can see a pattern of paving the way for the pm to have contacts with the Vatican without arousing " deep " suspicion and cause unnecessary uproar amongst muslims; easy, meet the pope ( actually meet the inner shadowy figures of financial wheeling dealing in the Vatican ) just to explain Malaysia's religious tolerance. The whole world, especially Malaysian Malays buy that line, hook and sinker! The fact is that it was an old dr madhey kutty trick; at times of trouble, make an excuse to be visiting Europe and the Vatican WITHOUT AROUSING suspicion. Then get to meet the European/Vatican wheeler dealers to arrange mind bongling transactions which will fool the so called clever analysts all the way and laugh all the way stashing all the ill gotten gains.

The Air Asia/MAS deal is just a small example of such deals. You ain't seen nothing yet! Just remember the " financial " miracle recovery of 1997; the currency trading losses, Maminco, the " George Soros saga ". The old fox could easily win an oscar hands down.The pawns, knights and rooks in this super chess games are the patsies executing the orders, but the bishops, queens and kings reap all the rewards with everyone fooled. Some pawns will probably get some crumbs and think the world about this deal, the rest are just gobsmacked taking it up their sixes with barely a whimper. Welcome to the shadowy world of real power, money and endless intrigue!

nasree

11th Aug 2011, 23:52

That reminds of someone posting about our Petronas oil futures, the Vatican, Soros and Dr M on some other threads sometime ago. Well, the shadowy powers that be certainly have the whole nation within their grip.
However the ordinary masses by collective will and intent can break free of the shackles imposed upon us, or at the very least mitigate some of the damaging effects. Representations must be made for class action suits by ordibnary shareholders, and actions taken to scuttle this improper deal through international anti-trust laws.

nasrazlan

12th Aug 2011, 00:21

Ladies & gentlemen, try as you may it looks like you ain't gonna get even a squeak out of MAS pilots

Can't totally blame them; they are alway scared that they are snooped on by the police special branch and their emails monitored by apco! The atmosphere of fear and intimidation so prevailing in bolehland puts paid to any dissent from the gomen/management viewpoints.

bila

12th Aug 2011, 00:51

Guys, whether like or not, that the name of the game. If MAS can't get their act right within, then what would anyone expect?
Its all a matter of opportunities people in the real world take when there are cracks, holes or what some say "window of opportunity" ;)

Good luck guys!

chintanmanis

12th Aug 2011, 21:33

If MAS can't get their act right within, then what would anyone expect?

I don't think that MAS is to be blamed. It's the crooked and corrupt government using dishonourable and dubious business manoevres to siphon off from our crown jewel. It is sad that there is hardly a whimper from MASEU and MAPA. There are so many web based avenues to protest this utterly disgraceful deal, unless these two entities are complicit in shameful plunder.

Paishinel

13th Aug 2011, 20:52

It is sad that there is hardly a whimper from MASEU and MAPA. There are so many web based avenues to protest this utterly disgraceful deal, unless these two entities are complicit in shameful plunder.

MASEU and MAPA members are just innocent lambs for sacrifice. The union chiefs and MAPA excos? Hmmmmmmmmmmmmm

Teg Bahadur

14th Aug 2011, 00:34

AK has a poor PER whereas MAS has a better PER; yet 20.5% of MAS shares for 10% AK shares. This is indeed very creative and astonishing. Looks like AK is a better standard bearer; MAS people should take a paycut to about 48.8% that of AK employees! Especially the pilots!

klmasdriver

14th Aug 2011, 02:04

MAS people should take a paycut to about 48.8% that of AK employees! Especially the pilots!

LOL :}:}:}:}

Almost die laughing. Bangunlah bang , do you think anyone of us even remotely give a crxp about this?
I know I will continue to get better pay, and work less, or even much much less when I move on to 380 next year.
Carry on bang, instigate more of us.
Oh, btw, welcome to the real corrupted world of aviation, and you haven't seen shxx.

Mat Sapu

15th Aug 2011, 02:16

Hey guys, see what have you done...you got someone to pull his head out of the trough to register on this forum to crow to the world that he is going to the big dugong next year! And he is going to work less! How about a little whisper to tf to sell off all the yet to come dugongs and stick to only the 330/340s? I don't want competitionlah.

baachang

15th Aug 2011, 20:24

Over the course of the past few years a few guys on this forum had been subtly trying to do a " bersih campaign " to awaken individuals in MAS and Malaysians at large to the shenenigans going on in the company as well as the incestuous relationships amongst the management, union/association leaders, politicos and jackals of the tf ilk. Due to various reasons, we cannot be so overt in our messages.

Most MAS people think we are lunatics or worser still " traitors " trying to run down the mothership. Nay, nyet, bukan my dear friends. We see MAS going to be misused as a cash cow and as an avenue to plunder the wealth of the nation. Because MAS operates to " six continents " it provides portals where the siphoning of Malaysian wealth to be stashed away without electronic traces. See what I mean or are you people still so blind!

Modern electronic means of wealth siphoning, money laundering are fraught with danger of being traceable. Good old ways like the way they do in the good old days are much safer............

Now what can MAS people and the general public do? What could the " Bersih " campaigners do? They did what they did and what did they accomplish? The EC was caught redhanded with so much blatant attempts at cheating but because of the " awareness " for fair and just elections was aroused by the " Bersih " campaign, many of the overt attempts at cheating had been scuttled. More needed to be done to clean up the dirt, but some progress can be made.

Likewise if MAS people can lead a campaign to " bersihkan " MAS, Air Asia, MoT etc, there is less chance of the nation's wealth being siphoned off through MAS. The share swap thingy between AK and MH is just the tip of the iceberg; MAS provides big portals for crooks to exploit. Why MAS people and not other Malaysians to do the " bersih "? Well, MAS people have high visibility, " insider information ", etc which will attract attention to the cause of cleaning up.

If nothing is doing, MAS/AK will become the " route " which will hasten tanahair going the way of Zimbabwe:{:{:{

Kal Niranjan

18th Aug 2011, 22:59

MAS people like it up their six, period! tf and his patrons are laughing their heads off. Now he can fly top class to LHR weekly to watch QPR in action; well Munir showed the way!

Kentot Gemuruh

19th Aug 2011, 03:18

Modern electronic means of wealth siphoning, money laundering are fraught with danger of being traceable. Good old ways like the way they do in the good old days are much safer............

Are you alluding to the incident whereby a certain rat by the name of dime booked an additional FC seat for a huge case on a T7 to ZRH?

gerago

21st Aug 2011, 22:01

Ha ha ha, heard about the ZRH caper...was that true? I wasn't on the 777 then, but a few ex 777 guys told me about it. First class seat for the money bag; but as mof, do you think he paid for the flight? Most probably foc as we all know that he's pak bakhil!

hassanasli

23rd Aug 2011, 02:01

By Jahabar Sadiq, The Malaysian Insider
KUALA LUMPUR, Aug 23 — Malaysia Airlines (MAS) is considering delaying its membership with global airline group Oneworld and deliveries of the super airliner Airbus A380 as its new management focuses on cutting losses, which spiked in the second quarter of 2011.
The Malaysian Insider understands that MAS will announce a bigger loss today for this year’s second quarter, traditionally its weakest business period, from the net loss of RM242.3 million in the first quarter ended March 31. It posted a pre-tax loss of RM532.6 million for the second quarter in 2010.
“The exco met last week and are looking at their options of delaying the alliance with Oneworld because it will cost money to provide interlining services and also upgrade the lounges to their standards,” a company source told The Malaysian Insider.
“They are also looking at delaying the A380 deliveries. It’s already delayed since 2008 but the exco is concerned if it can make money for MAS,” he added, referring to the executive committee headed by MAS chairman Tan Sri Mohd Nor Mohd Yusof now managing the airline after managing director Tengku Datuk Azmil Zahruddin resigned effective August 9.
Azmil’s resignation was announced after the airline’s biggest shareholder, state asset manager Khazanah Nasional Berhad, swapped 20.5 per cent of MAS stock for a 10 per cent stake in Asia’s biggest budget carrier AirAsia on August 9. The swap enabled AirAsia bosses Tan Sri Tony Fernandes and his partner Datuk Seri Kamaruddin Meranun to sit on the MAS board and help turn around the loss-making flag carrier.
Another source confirmed the possibility of delays, pointing out that MAS is now just a designated member of Oneworld since June and has to go through a process that could take as long as 18 months before being a full member of the world’s third biggest airline group.
It is understood that a cause of concern is MAS’ sponsor to join oneworld, Qantas, which recently announced it wants to set up two new airlines in Asia with part of its US$9 billion (RM26.81 billion) plane order from Airbus in order to salvage its loss-making international business.
Under the plan, the Australian carrier has decided to set up a Japanese budget airline with Japan Airlines and Mitsubishi Corp and a premium airline based in Southeast Asia, possibly Malaysia.
“MAS is going to be a premium airline and if Qantas goes ahead with its plans, there will be competition. An alliance might not work then, apart from the costs of meeting the alliance’s standards,” the source said.
When MAS announced its entry in Oneworld last June, it said that MAS passengers will gain access to the alliance’s global network which covers almost 950 destinations in 150 countries. MAS Enrich frequent flyer members will be able to earn and redeem rewards on Oneworld’s carriers and vice versa.
This strategy was to work with the April 2012 delivery of the first of six A380s that MAS ordered in 2003. There has been three delays for the world’s biggest passenger jet from Airbus, which were first to be delivered in January 2007 before being delayed to last January and the third delay was to this month before it was confirmed for next year.

READ MORE HERE. (http://www.themalaysianinsider.com/business/article/mas-mulls-delaying-alliance-a380s-as-losses-mount/)

Virtual Reality

23rd Aug 2011, 09:30

............. and what next? ........ reduce the fleet size to half, provide feeder service to AAX ......... and strip everyone (MAS) naked .......:D

Well done Khazanah ....:yuk:

'Satu lagi projek oleh Kerajaan Barisan Nasional'

VR:cool:

ganga747

25th Aug 2011, 13:41

The interim financial results are out. AA profit took a nose dive, down 46 % from same period last year due to Firefly eating into its LCC buisness. MAS lagi teruk. The Firefly operations is bleeding MAS and so the rational thing to do is stop this "unhealthy" competition and allow each to fly a certain market segment. Actually the drop in AA profit is because Firefly has taken appox 3 million pax from AA operation. So QPR boss has done the good deed to make all survive. AA to do low cost operation, Firefly to do only ATR out of Subang and create Saphire to carry all the yuppies and rich umnoputras on the domestic route and MAS to vie for the long haul premium class.

Also heard that a super VSS is along the way to trim MAS down to 12000 and make the employees more productive. Not sure how this is going to happen.
Non core business will be re-assessed and if not generating money it will be axed
Cost management is the mood here today. See lah what happens in the mean time retirement is looming ahead.

ipohmali

27th Aug 2011, 20:40

Looks like there are lots of umno dominated sheepeople in MAS judging by the deafening silence on this thread. Let's see if we can fire it up :

Malaysia Airlines' short-term outlook bleak despite new alliance with AirAsia (http://malaysia-today.net/mtcolumns/special-reports/43075-malaysia-airlines-short-term-outlook-bleak-despite-new-alliance-with-airasia)

SPECIAL REPORTS (http://malaysia-today.net/mtcolumns/special-reports)

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http://img43.imageshack.us/img43/2756/masairasiaairlinedealta.jpg
By Centre for Asia Pacific Aviation
Malaysia Airlines (MAS) reported a heavy loss in 2Q2011 (three months to 30-Jun-2011) as soaring costs, led by fuel, weighed on the result. The 2Q2011 loss is MAS’ second-consecutive quarterly loss and the carrier expects to remain in the red for the rest of the year.
MAS reported a net loss of MYR525.8 million (USD177.7 million) in the second quarter, seasonally its weakest. Aggressive capacity deployment, under-performance from its revenue management and sales teams and increasing competition from regional and Gulf-based rivals also hurt the 2Q2011 result. The net result was a slight year-on-year improvement, but the airline’s operating loss swelled to MYR412.5 million (USD139 million) from MYR285.6 million (USD95 million) in the same period last year.

The deteriorating operating performance reflects the sharp increase in operating costs, led chiefly by fuel, which surged 41% in the period, and a weaker cargo performance, which pushed the airline deeply into the red. MAS’ operating margin for the quarter was -12.0%.
Various initiatives will be undertaken to reverse MAS’ woes. Most notably, MAS has announced a tie-up with Malaysian LCC powerhouse AirAsia and its long-haul offshoot AirAsia X, the airline grouping largely responsible for MAS’ struggles over the past decade.

MAS said its board “has identified immediate priorities to focus on in the short-term”, aimed at stemming losses. “Working with the new executive committee…recovery initiatives will be implemented to turn the company’s fortunes around and to start rebuilding cash reserves,” which have fallen sharply in 2011. Immediate initiatives will include, among others, more prudent capacity management, implementing new dynamic pricing to improve yields and revenues and a review of products and brand positioning.

Revenue up, but costs neutralise gains
MAS recorded an 8.5% increase in top-line revenue to MYR3,429 million (USD1.17 billion). Revenue gains were, however, neutralised by soaring costs, which increased 11.4% in the period to MYR3,897 million (USD1.31 billion), which pushed the airline deeply into the red for the quarter.

MAS revenue and operating expenses (MYR million) and growth (% change): 2Q2007 to 2Q2011

Source: Centre for Asia Pacific Aviation and MAS
MAS net profit (MYR million): 2Q2007-2Q2011

Source: Centre for Asia Pacific Aviation and MAS
Passenger revenue increased 9.1% to MYR2,086 million (USD698 million) and revenue from fuel and administration surcharges rose 45.2% to MYR495 million (USD166 million).

Cargo revenue however was much weaker in the period, reflecting the lower year-on-year trade volumes seen in the region, which was skewed by the replenishing of global restocking of inventories in early 1H2010 following the global financial crisis. Total cargo revenue fell 16%, led by a 24% fall in belly and freighter revenue. The cargo segment’s fuel surcharge, which increased 6.6% to MYR145 million (USD48.5 million), helped mitigate the sharp fall in cargo revenue.

But spiralling costs significantly outweighed revenue growth. Operating costs increased 11.5% to MYR3,987 million (USD1.31 billion). Fuel, unsurprisingly, led the rise in costs. Fuel costs surged 41% in 2Q to MYR1,550 million (USD519 million), to account for 40% of total operating costs, up from 30% in 2Q2010. The sharp fuel price rise masks what would otherwise have been an impressive cost performance in 2Q2011, with non-fuel operating costs down 2%, reflecting MAS’ aggressive and consistent cost control measures.

ASKs increased 10% and RPKs increased 12%, pushing average loads up 1.5ppts to 75.5%. The stronger load factors and other various yield-supportive measures, such as fare increases and fuel surcharges, saw yields increase 1% to 24.2 sen (USD8.16 cents), with RASK up 3% to 18.2 sen (USD6.14 cents).

Strategic shake-up aimed at ending MAS’ woes
Since the end of 2Q2011, a major strategic development has taken place as MAS forged earlier this month a tie-up with rival AirAsia, which has moved aggressively into MAS’ short-haul, regional, and more recently, its long-haul markets. Khazanah, a national investment vehicle and majority shareholder in MAS, purchased a 10% stake in AirAsia from Tune Air, as part of a cross-equity deal. Khazanah will also purchase a 10% stake in AirAsia X. Tune Air, the largest shareholder in AirAsia and the investment vehicle of CEO Tony Fernandes, acquired a 20% stake in MAS from Khazanah.

See related report: Turning the industry on its head: AirAsia joins Malaysia Airlines

A Joint Collaboration Committee (JCC) was formed on 09-Aug-2011, which will look into key areas for collaboration to realise synergies and cost efforts, MAS says. MAS and AirAsia aim to cooperate in areas such as engineering and ground support, aircraft purchasing, catering and training and cargo services.

The Malaysian government said the agreement would end cut-throat competition between the airline groups, allowing them to grow together and more profitably than would otherwise be the case. Mr Fernandes said the deal allows his airline to focus on growing the business, “as opposed to spending a lot of time on politics and fighting unnecessary battles”. The collaboration should also boost yields for both airlines.

Better market segmentation should also be achieved under the deal, with one partner targeting the low-cost, leisure market and the other, the higher-yielding and premium market. Firefly, MAS’ LCC subsidiary, also recorded heavy losses in 1H2011 and will be re-structured to focus on the short-haul premium travel space using turboprop equipment. MAS said a longer-term solution for Firefly would be developed by the management team to put the airline on course for sustained profitability.

While Firefly will retain its ATR-72s, the carrier's B737 fleet is expected to be transferred to the new regional, full-service airline, Sapphire. But it remains unclear how MAS, which also has a regional carrier unit in east Malaysia with ATR-72 operator MASwings, will juggle so many brands. Of particular interest will be how the Sapphire unit differs from MAS' existing regional narrowbody services.

MAS, in releasing its 2Q2011 earnings, also said its multi-year re-fleeting programme will be accelerated. As of mid-Aug-2011, the airline has taken delivery this year of five new B737-800s and five new A330-300s. Over the next four months, MAS will take delivery of six more aircraft – two B737-800s, two A330-200Fs and two ATR-72s. Excluding these aircraft, MAS’ order book comprises 38 B737-800s, ten A330s, six A380s and two A330-200Fs. The airline said its fleet delivery schedule would be accelerated in the next few years, adding that all required financing activities for 2012 have been completed.

Weak result matched by gloomy outlook
MAS expects a weak second-half due to elevated fuel prices and sovereign debt fears in key markets which will continue to weigh on consumer confidence and economic growth. The airline’s forward bookings indicate challenges in the European, US and Japanese markets, with “normal” trends for other regions. The third quarter will be soft owing to the month of Ramadan, when travel is seasonally slow.

In response to the challenging outlook, MAS will moderate its capacity growth in 2H2011. The airline will also review its route network and adjust capacity accordingly. MAS will retire two B747-200Fs, one B747-400 and three B737-400s by Oct-2011.

The airline will also have a heavier focus on yield management, with new revenue systems to be introduced in 2H2011. MAS aims to enhance its yield performance through front-end business class initiatives, implementation of fuel surcharges and step up its yield/revenue management.

A loss in 2H2011 is still expected, though MAS said it would be less severe than 1H2011, due to these initiatives.

MAS’ most significant turn in fortunes is likely to come from its tie-up with AirAsia, a deal that effectively neutralises a major competitor and a leading cause of losses in recent years. Under the agreement, MAS also gains two successful and experienced aviation executives on its board, in Tony Fernandes and AirAsia deputy CEO Kamarudin Meranun. This expertise at senior management level should help MAS overhaul its network, alliance and fleet strategies and navigate the flag carrier through some more desperate times.

babasinkeh

2nd Sep 2011, 06:01

With the undignified deafening silence on this thread, let's ponder further on this :

AirAsia-MAS share swap: The barbarians have entered the gates (http://malaysia-today.net/mtcolumns/guest-columnists/43181-airasia-mas-share-swap-the-barbarians-have-entered-the-gates)

http://img836.imageshack.us/img836/5849/masandairasia.jpg
Unlike the RJR Nabisco takeover where there was a fierce battle for control of the company, in the fight for control of Malaysia’s skies, AirAsia were allowed to enter the MAS gates without hindrance. The gates protecting MAS’s control of Malaysian skies were opened wider and wider for AirAsia over the past 10 years due to inconsistent government policies.
William Leong, The Malaysian Insider
SEPT 1 — In the 10-year war for control of the Malaysian skies, while a besieged MAS was desperately fighting for survival, someone opened the gates for the barbarians to enter.
Barbarians at the gates
The AirAsia-MAS share swap reminds me of the takeover saga of RJR Nabisco. The company was a merger of RJ Reynolds, the tobacco company selling “Camel”, “Winston” and “Salem” cigarettes and Nabisco, the biscuit company selling “Oreos”, “Ritz Crackers” and snacks.
The financial firm of Kohberg Kravis Roberts & Co (commonly referred to as “KKR”) made a hostile takeover bid for the company. There was a fierce battle for control of the company. The board, in protecting the company’s and shareholders’ interest, drove KKR and the other bidders to increase their bids several times until KKR won with a bid of US$31.1 billion (RM93.3 billion). It was the largest leverage buyout in history and the record stood for 17 years. RJ Reynolds was subsequently spun out of RJR Nabisco due to tobacco legislation. Nabisco is now owned by Kraft Foods. The RJR Nabisco leverage buyout was considered to be the pre-eminent example of corporate and executive greed. The events were chronicled in a book called “Barbarians at the Gate: The Fall of RJR Nabisco”.
The fight for control of the Malaysian skies has been an uneven battle from the beginning. In the end those responsible for MAS’s defence not only did not put up a fight but opened the gates to allow AirAsia into MAS’s management. The share swap has given rise to concerns on the pricing and whether it will benefit the public-funded MAS.
Pricing issues
One of the favourite sayings of corporate raiders and businessmen is “OPM”, that is to operate using “Other People’s Money”. In the case of the AirAsia-MAS share swap, it is the people’s money because MAS is funded by taxpayers.
The pricing of the share swap has raised eyebrows. The parties, in using the August 5 closing market price of both airlines as the basis for the share swap, have raised several concerns.
Datuk Seri Anwar Ibrahim, in his August 10 article “MAS-AirAsia share swap deal raises serious concerns over effective control and governance”, referred, among others, to issues of insider trading and asset stripping.
A look at the price charts of the two companies for the past six months supports Datuk Seri Anwar Ibrahim’s concerns. The MAS share price fell sharply on May 30, 2011 to RM1.34. It continued to be in the doldrums until August 5, the date of the share swap announcement. AirAsia’s share price was on a steep and sharp climb from May. It surged to a height of RM4.20 on August 4, 2011. This is on the eve of the announcement.
There may be good reasons for the share prices of the two counters moving the way they did. However, it seems improbable for this to be coincidental. AirAsia’s price was trading around its highest and MAS among its lowest when the share swap took place. AirAsia’s price fell immediately after the announcement. It could be that those who held AirAsia shares did not like the deal. It could be whoever was playing up the AirAsia shares stopped doing so. There is therefore cause for investigations to be made.
Others have raised concerns with the price. Khazanah exchanged 20 per cent of MAS at RM1.60 per share for 10 per cent of Air Asia at RM3.95 per share. They believe the price should not have been based only on the closing market price of the two counters on August 5. They point out that MAS in fact is worth more than the price traded because it is an asset-backed corporation. It has a paid-up capital of RM3.34 billion represented by fixed asset value at RM8.4 billion, net asset at RM6.92 billion. AirAsia, on the other hand, is a debt-laden company. It has borrowings of RM7.7 billion. MAS’s cash position is RM2.086 billion while AirAsia’s is RM1.7 billion. Those who approved the deal will need to justify the pricing.
One other issue on pricing is the timing of the deal. The share swap was announced on August 9. This was within 30 days before both AirAsia and MAS announced their respective 2nd quarter financial results on August 23. Under the Bursa Malaysia Listing Requirements, this is known as the “closed period”. Those in possession of the financial results during the closed period are not allowed to deal with the shares until the results are announced. This is to prevent insider trading by those with possession of price-sensitive information. Those who trade in the shares with such information will be taking unfair advantage of the public who are unaware of the situation. Paragraph 14.08 of the listing requirements allows principal officers who do not possess the information to deal during the close period by giving the requisite notification. Although the listing requirements allow such dealings, it would have been more prudent not to enter into the share swap during the closed period.
If the share swap was made after the financial results of both airlines were announced, the market price may have given a better reflection of the share price of both airlines. This may be seen from the share price of AirAsia after the results were announced on August 23. Although AirAsia announced it made a profit, it was 48 per cent less than the previous year. The AirAsia share price fell to RM3.57 at 9.04am on August 24, the day after the results were announced. Those involved will have to explain why the share swap was done before the 2nd quarter results were announced.
Opening the gates for the barbarians
Unlike the RJR Nabisco takeover where there was a fierce battle for control of the company, in the fight for control of Malaysia’s skies, AirAsia were allowed to enter the MAS gates without hindrance. The gates protecting MAS’s control of Malaysian skies were opened wider and wider for AirAsia over the past 10 years due to inconsistent government policies.
Regulation determines airlines’ fortunes
International air transport operates within the framework of the 1944 Chicago Convention for International Air Transport. Governments enter into bilateral agreements setting out the landing rights, restrictions on capacity and pricing. Sectors within a single country are normally denied to foreign airlines. This restriction is called cabotage. It is recognised that cabotage is the prerogative of the domestic carrier. The system of bilateral agreements between two governments has led to the aviation industry to be highly regulated. There has since been a change towards deregulation and liberalisation. Nevertheless, the industry remains one where regulation plays an important role.
Regulation is thus a critical determinant of an airline’s performance. It can determine how competitive the market is as well as constrain an airline in its choice of fares, capacity and frequency. Most governments impose entry controls which are usually applied to particular routes. Most governments usually permit one airline to operate a route. The government therefore plays a critical role in determining the fortunes of an airline by deciding on the routes to be given to the airlines.
Golden service takes a beating
MAS’s finance and operation problems to a significant extent are due to the government’s inconsistent and contradictory air transport policy. Such decisions gave the MAS Golden Service a beating while AirAsia became the Golden Child.
The main asset of any airline is its route networks. The government first allowed AirAsia to compete with MAS and then gave MAS’s domestic routes to AirAsia and had its route networks reduced while AirAsia increased theirs.
READ MORE HERE (http://www.themalaysianinsider.com/sideviews/article/airasia-mas-share-swap-the-barbarians-have-entered-the-gates-william-leong/)

taufupok

9th Sep 2011, 00:57

Latest MAS financial statements of recent years indicated that the only year of operating profit was in 2007. All the profits from the other years are from asset sales, from subsidiaries and lucky fuel hedges.

This kind of business operation is dodgy and distract the management from operating the airline properly besides fooling shareholders into thinking that the business is doing well.

bakutteh

9th Sep 2011, 09:32

By Agence France-Presse, Updated: 9/8/2011
Malaysia Airlines workers oppose AirAsia alliance

Thousands of Malaysia Airlines workers Thursday said they oppose a planned merger with AirAsia as the move will only benefit the profit-making budget carrier.

About 15,000 members of the flag carrier's unions said they would picket to protest the proposed share swap programme.
"What we saw from the collaboration is that it will benefit AirAsia and also there is a rumour that a new airline company will be set up from the collaboration," Alias Aziz, president of the Malaysia Airlines Employees Union, was quoted as saying by the official Bernama news agency.
Bernama quoted union representatives saying the deal would not benefit loss-making Malaysia Airlines and was an attempt to weaken the workers collective power.
"We do not agree with the collaboration," Alias said.
Last month fast-growing budget flyer AirAsia agreed to acquire 20.5 percent of Malaysia Airlines under a strategic tie-up aimed at turning around the national carrier.
The deal gives Malaysia-based AirAsia's CEO Tony Fernandes -- who took over the no-frills carrier a decade ago and made it one of the industry's biggest success stories -- a key voice in salvaging his struggling rival's fortunes.
Under the deal, Malaysia's state investment arm Khazanah Nasional, which held nearly 70 percent of the national carrier before the deal, will get a 10 percent stake in Tune Air, AirAsia's parent company.
Since taking office in 2009, Prime Minister Najib Razak has embarked on an ambitious programme to overhaul the economy and public sector, including selling off stakes in troubled state-owned companies like Malaysian Airlines.

arba

9th Sep 2011, 15:29

what about FireFly then ??? full service ??

Amitabh Belacan

9th Sep 2011, 18:40

mapa is management's bedfellow, so cannot oppose the deal one! ainako...go class AO79E, satu mas/mapa ala satu malaysia! tan silly tf can do wonders bah; his big time con game sit well with the ainako trained mapa/mas flt ops chiefs.

Teg Bahadur

9th Sep 2011, 19:18

Well MAS's coffer will be raided by the tan silly tf to stuff the pockets of his patrons who think that the present regime is quite shaky, so make hay when the sun still shines. All manners of manoevres are used; one interesting one is the move to acquire QPR and attempts to lure David Beckham to Loftus Road. Soon MAS will be flying all of tf's patrons and their entourage round the six continents for their super deals to stash all their ill gotten gains. MAS will be used to fly the Beckhams and their retinue free as inducement and so on and so forth. MAS pilots get to rub shoulders with such celebs.....huh, not bad, I wanna get into this game too!

jandakotcruiser

9th Sep 2011, 21:44

Are you serious, Malaysian entities making forays into the EPL? Wow, either they have really deep pockets or are just plain foolhardy!

When I was in MAS back in the late 80s and early 90s I knew that the Malaysian Central Bank lost billions trying to cream off the pound sterling fiasco and then they lost their pants trying to corner the tin market at the LME. Will you guys ever learn? I agree that the MAS employees should stand up to prevent another kind of such foolishness. I made good friends at MAS and am pretty sad to see the hard work put in by such nice people go down the so called jambun!

ipohmali

10th Sep 2011, 19:12

Wow, jdkcruiser must be really into the Malaise-ian thingy during your tenure in MAS...right we lost billions in the attempts foreign currency trading fiasco with George Soros coming up tops. The crazy thing is that the mamak dumbo who lost the nation's fortune is now made top dog at our finance ministry!:{ The Maminco fiasco at the LME was another kaka kerala kutty project but our MARA trained MAS pilots worship him more than A**** swt!:ugh:

Kal Niranjan

13th Sep 2011, 02:53

MAS just sacked its lawyer RD and gave the whole legal work to some umno government dominated legal firm to handle the deal. Apparently RD knew heaps about the TR shenanigans and they feared that he would be a liability in this deal which would be certainly against national interest.

hassanasli

13th Sep 2011, 17:25

Seems like a lot of bolehland sheeple want to see no evil, hear no evil, speak no evil; so let me be the bad guy to lspread more info on the evils. Read this :

Barisan Nasional Saving MAS or Killing It? (http://www.malaysia-today.net/mtcolumns/letterssurat/43423-barisan-nasional-saving-mas-or-killing-it)

Now we are seeing the true “masterplan” of Tony on how to wipe out MAS totally.
By Mat UMNO
Reported By Forbes.com, “The collaboration won't work. We believe it only benefits AirAsia, which will get (the advantage of) a free hand in the low-cost segment," union secretary-general Abdul Malek Arif told The Associated Press. Abdul Malek said staff were told at a briefing last month that a new premium carrier called Sapphire Air would be set up to handle regional and domestic routes. The fate of Firefly, the current
low-cost unit of Malaysia Airlines, remains unclear, he said.
While details remain vague, he said 80 percent of Malaysia Airlines' staff are expected to be transferred to Sapphire Air - a move he claimed was aimed at busting the union, which will make it easier for the new management to retrench staff. "Why is there a need for a new airline? There is a lot of confusion now over Malaysia Airlines' direction and policy. Everyone here feels their job is at stake," he added.”
Reported By The Star, “MAS is the oldest airline in Malaysia. There is no reason for not making a lasting profit,” Ab Malek said, adding that the Government should revamp the entire management.”
Reported By YB Wee Choo Keong, “Updated 06-09-2011 @ 11:30 pm: It was a known fact that MAS set up Firefly to provide an alternative to AirAsia and AirAsia X Sdn Bhd previously known as Fly Asian Express Sdn Bhd aka as FAX. Remember in 2006/2007 FAX snatched Rural Air Services (RAS) from MAS during Tun Abdullah Badawi’s administration and received about RM65 million from the government as subsidy.
However, in a short span of 8 months or so it dumped seven un-airworthy aircrafts to MAS with a total bill of RM35 million.
On 12-11-2010, Firefly said in The Star that “it would fly commercial jets for domestic routes and begin with crossover routes, e.g. Kota Kinabalu and Kuching, on Jan 15. Asean will be its next stop”. So it was crystal clear from the decisions of the new management of MAS consisting of Tan Sri Tony Fernandes, Datuk Kamarudin Meranun (both of AirAsia and AirAsia X Sdn Bhd/FAX), Tan Sri Md Nor MD Yusof, Datuk Azman
Yahya and En Mohammed Rashdan Yusoff aka Danny to terminate Firefly services from JB to Kuching and JB to Kota Kinabalu via an email dated 25-8-2011 as published below. We have been indoctrinated by Tan Sri Tony Fernandes that competition is healthy and good for the travelers. Are we witnessing the real Tan Sri Tony Fernandes now?
Perhaps we can now see a bit clearer whether MAS needed AirAsia to survive as made out to be the case in a news portal and mainstream media or the other way around.
I have been informed that during the Hari Raya season several full load flights of Firefly have been cancelled at the eleventh hours. The cancellations have caused enormous inconveniences to members of the public, who were on their balik kampung back to see their families. Why cancel full load flights during a festive season? Where is the business sense of MAS current management? Even if you want to help your close friend like Tan Sri Tony Fernandes/AirAsia, please don’t do it at the expense of the public.
This is not the way to kill Firefly, indirectly MAS. Surely with all your top financial qualifications and famous credentials under BinaFikir you should know of better ways to skin a cow! Why are you in such a rush to kill Firefly in such a desperate manner? I am sure that Datuk Omar Ong will advise you against such ill thought out decisions.

Below is the e-mail dated 25th August 2011 from MAS HQ to all its agents.

Dear Valued Agent,
Greetings from Firefly!
We regret to inform you we will no longer operate JB – Kuching V V & JB – Kota Kinabalu V V route from September 15 onwards. We don’t advise a re-routing of flights because we don’t want to inconvenience you further. A re-route through a third destination such as KLIA will double the length of your travel time if not more.
To minimize disruption to your time, we strongly suggest the solution of a refund.
We apologize for the inconvenience caused and wish to offer you a refund in the form of credit shell. Please allow 8 weeks for the refund to be processed. Due to our network rationalizing exercise, and we’re very sorry that this has inconvenienced you.
We at Firefly are more than obliged to work hand in hand with you on other routes and will do our very best to see the production grow for both our parties.

The above is the email sent out by MAS HQ to its agents on 25th August, 2011. The work of the powerful unseen hands. This must be part of the game plans of the so-called “MAS – AirAsia share swap”, which was shrouded in secrecy.
After the signing ceremony of the said share swap between Tan Sri Azman Mokhtar and Tan Sri Tony Fernandes on 8-8-2011, it was immediately announced that Firefly will soon change its business model. Presumably, what the economic genius in Khazanah and Tan Sri Tony Fernandes meant was Firefly will stop competing with other low cost airlines, in particular AirAsia.
Instead of chasing after huge debts owed by Alwafeer Air, which involved non-payment of leasing rentals for three jumbo jets amounting to ten of millions of ringgit, En Mohamed Rashdan Yusof, the Khazanah’s representative in MAS management was more interested in how to disrupt and/or stifle Firefly for the benefit of the competitor of MAS. Guess who?
If the stopping of Firefly’s profitable routes to East Malaysia was part of the said secret share swap exercise by YB Nor Mohamad Yacop, the former Minister of Finance II under Tun Abdullah’s administration now Minister in charge of EPU, Tan Sri Azman Mokhtar and En Mohamed Rashdan Yusof, both of whom are former business partners in BinaFikir Sdn Bhd, then Firefly is as good as dead! The future of MAS is not hard to determine.
The time has come for the rakyat, bloggers and, most of all, the MAS Union to join hands to stop the rot.
Well done YB Wee! Few bloggers and parties had tried to warn the government and people about what will happen when the MAS/AA share swap deal is sealed. You can refer to my older posting on “MAS AA Share Swap” does anyone listen or even think about it?
NOOOOOOOOOO……
Now we are seeing the true “masterplan” of Tony on how to wipe out MAS totally. Don’t believe me? In my previous writing, I’ve already explained the financial benefit and how AA can use MAS as a scapegoat in burdening them with debts and abusing the advantage of MAS capabilities. What slips my mind was the fate of Firefly.
MAS set up Firefly with the intention to compete with AA despite MAS' hands being tied by the government as Ministry of Transport favors AA much more. It is said that the Ministry of Transport has a few bucks going in their pocket from AA. When I said “few bucks going in their pocket from AA”, I don’t mean AA is donating the money directly to the “Ministry of Transport” itself. It is more directly to those high ranking in the ministry
that benefited from it.
AA will skin and poison Firefly and MAS slowly. They already managed to be in MAS so now they have the opportunity to shut down Firefly. But why shut down Firefly and create a new airline such as Sapphire Airline?
Here are a couple of reasons; Firefly is seen as a direct competitor to AA's business locally and internationally. Firefly has already made good ground in giving AA a run for their money as it offers better service, competitive prices and departure convenience. This has been noted a few years back by AA and they needed to do something about it after all, there are more benefits to AA with the closure of Firefly.
Recently, it was announced that Tony had just bought over the Queen Park Ranger football team. I have no issues with his passion for football but when you start sponsoring your own football team with the money from MAS, it becomes totally wrong. First of all, MAS reported a loss recently and AA made profits. So how could a losing company pay for the sponsorship?
The reason MAS and AA decided to sponsor QPR was for better market exposure. Hmm, why sponsor a football club? How much is the sponsorship? Which target market do they target? What is the ROI from the sponsorship?
With the sponsorship of QPR happening without a glitch and without consultation from Khazanah, what will stop AA from sponsoring their F1 racing team? MAS will be again used to pay for Tony’s hobby and the saddest part of it is no one will stop him because he has “political’ strings.
I cannot emphasise how dangerous this man is to MAS. His cunning business ways are only suitable for him and not for others. He is a wolf in sheep's clothing!
The fates of 15,000 MAS staff too, hang in danger with the opening of Sapphire Air. The union cannot do anything without help from the government. Why is it the government willing to lose 15,000 votes in this coming election? These 15,000 vote can quadruple as they have family and friends that will listen to them!
When Sapphire Air emerges, no one can stop AA from permanently destroying MAS! The union will be helpless. I can give you the scenario how AA will systematically kill off MAS:
1. Sapphire Air is born. They will offer the current MAS staff to “migrate” with lower pay and lesser benefits.
2. If Sapphire Air does not have enough staff, this will be better for AA as they can now hire cheaper labour thus cut their operational costs.
3. Those who choose to stay can stay, but sooner or later, MAS downsizing will take effect, which means the company will offer VSS.
4. Khazanah will use the rakyat’s money to pay MAS staff “Voluntary Separation Scheme”. Why Khazanah? Well, Khazanah is still the majority shareholder and with money. AA is just the biggest individual shareholder but they don’t have money.
5. Those who decide to take the VSS can retire, start their own business or have enough money to last them for a few months while searching for a new job with lower pay. When this happens, whatever their current commitment, eg. house loan repayment etc will be jeorpadized!
6. Once they have fully transferred all the local routes to Sapphire Air, where can MAS or Firefly go?

So my question is … what can the current MAS union do to stop this? We are talking about people’s lives and it seems the government doesn’t care.
Prime Minister Najib Tun Razak, please open your eyes and heart regarding this matter. It is a matter of the rakyats' welfare and pride of Malaysia. We can turn MAS around if given a fair chance. Given a free hand to do business as it is supposed to be, without hands being tied behind our backs by Khazanah!
I dare say that BN will lose terribly should you allow this annihilation of MAS by AA!
More to come! ... Mark my words!

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bakutteh

14th Sep 2011, 05:52

:{:{:{:{:{http://biz.thestar.com.my/archives/2011/9/14/business/p1-masjersey.JPG
This is how the new queens park rangers home jersey will look like now that Malaysia Airlines are the new sponsors.
(The Star) - PETALING JAYA: Malaysia Airlines (http://archives.thestar.com.my/search/?q=Malaysia%20Airlines)' (MAS) recently-announced sponsorship for the Queen Park Rangers (QPR) home jersey in the Barclays Premier League will cost the national carrier some RM18mil or 3.7mil, according to a source.
The total sponsorship fee for both MAS and AirAsia (http://archives.thestar.com.my/search/?q=AirAsia%20Bhd) for the English professional football club, which involves a term of two years, would cost some RM30mil (6.2mil), the source added.
“MAS will take up a bulk or almost 60% of the total fees while the remaining will be forked out by AirAsia Bhd and its related companies which could also involve AirAsia X (http://archives.thestar.com.my/search/?q=AirAsia%20X).
“Typically, the home jersey sponsorship is more expensive than the away jersey,” the source said.
On Monday, MAS and AirAsia signed a jersey deal for QPR which will see the MAS logo adorn the jersey at home while the AirAsia logo will be used on the team's away games.
“This sponsorship is the first major initiative of our new brand and marketing strategy that would see important advertising money spent on boosting our top line. This is a key component in our drive to regain global market share, profitability,” said MAS executive director Mohammed Rashdan Yusof (http://archives.thestar.com.my/search/?q=Mohammed%20Rashdan%20Yusof).
Even so, most analysts are not thrilled. Their main grouse is that MAS should instead be focusing on strengthening its flagging financial status and showing some concrete moves towards this end.
Moreover, the crucial post of a chief executive officer for MAS has still yet to be filled.
The sponsorship deal by the two airlines closely follows a landmark share-swap deal involving the major shareholders of the respective airlines in early August which had turned the rivals into allies.
AirAsia's chief steward and major shareholder Tan Sri Tony Fernandes (http://archives.thestar.com.my/search/?q=Tan%20Sri%20Tony%20Fernandes)and his partner, Datuk Kamarudin Meranun (http://archives.thestar.com.my/search/?q=Datuk%20Kamarudin%20Meranun), collectively own a 75% stake in Tune QPR Sdn Bhd (http://archives.thestar.com.my/search/?q=Tune%20QPR%20Sdn%20Bhd), which in turn owns 66% of QPR Holdings Ltd. (http://archives.thestar.com.my/search/?q=QPR%20Holdings%20Ltd.) Fernandes, who only recently acquired the stake in the football club, is currently chairman of QPR.
In an earlier announcement to Bursa Malaysia (http://archives.thestar.com.my/search/?q=Bursa%20Malaysia), AirAsia said it would cough up some RM2.4mil or 500,000 as sponsorship fees for the duration of the two-year term.
Only in June this year, Genting UK, the largest casino operator in Britain, sealed a pact to be the main jersey sponsor for Aston Villa for two years. Although the amount was not disclosed, a source said the total sponsorship fees for the two years collectively involved some RM17mil or 3.5mil.

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Vel Paar

15th Sep 2011, 22:12

hassanasli, the way things are going there will come a time when there will be " MAS no mas, MAS no mas, MAS no mas "

The national carrier is used like an ATM for these crooks to use to buy their playthings. I don't ever see QPR to be viable business venture. The big wigs in this MAS-AK thingy will be rewarding themselves with first class travel to LHR every week for those pathetic QPR matches.

ipohmali

19th Sep 2011, 04:41

MAS-Air Asia merger flies into turbulent weather (http://www.malaysia-today.net/mtcolumns/newscommentaries/43511-mas-air-asia-merger-flies-into-turbulent-weather)

NEWS/COMMENTARIES (http://www.malaysia-today.net/mtcolumns/newscommentaries)

Saturday, 17 September 2011

By Patrick Lee, FMT
PETALING JAYA: The downside of the MAS -Air asia metrger is that the MAS workers have been left in the lurch. Opposition leader Anwar Ibrahim says this is because neither the government or the affected airlines have been transparent.
Anwar who claims that he was in contact with MAS employees said no information was given to the MAS staff.
” They must be told that their performance was not up to the mark… what is the problem, and what is their position going to be after the so-called merger or take-over?” Anwar asked during a press conference at PKR’s headquarters here.
“It’s all shrouded in secrecy, that is the trouble with this government.”
He also said that nothing had been said about the possible welfare of MAS staff, adding that the carrier’s workers were left in the dark about their fate.
“But you know, there’s always this management once they take over, they give this option, and people will be persuaded to take another option. These are concerns that must be addressed,” Anwar replied to the possiblity of layoffs.
The Opposition Leader was also concerned with Air Asia’s lack of an in-house union, which may be carried over to MAS once the merger took place.
Anwar then claimed that he had been informed that Air Asia employees who tried to form their own union were subsequently sacked.
MAS and Air Asia announced the merger last month.
However, both Air Asia chief executive officer Tony Fernandes and Khazanah Nasional Bhd -a major shareholder of MAS- managing director Azman Mokhtar denied that it was a merger, preferring to call it a “collaboration”.
They also denied that a monopoly would arise out of this “collaboration”.

READ MORE HERE. (http://www.freemalaysiatoday.com/2011/09/17/mas-air-asia-merger-flies-into-turbulent-weather/)

Telur Belacan

22nd Sep 2011, 19:37

Looks like the state of denial and loss of face prevails amongst our MAS bethren. However let's continue to post sensible arguments regarding this deal and see how it pans out.

This piece from a letter to a well known blog.

7 Reasons Why Khazanah Should NOT Undertake the Share Swap Between MAS and AirAsia (http://www.malaysia-today.net/mtcolumns/letterssurat/43619-7-reasons-why-khazanah-should-not-undertake-the-share-swap-between-mas-and-airasia)

The timing of the share swap could not have happened at a worst time as it will largely benefit AIRASIA shareholders even without their own effort and Khazanah has given away a large portion of their net worth in MAS for free.
By troubleshooters2011
1.MAS MANAGEMENT HAS INITIATED THE RIGHT STRATEGIES AND IMPLEMENTATION TO TURNAROUND THE COMPANY AND THEREFORE DO NOT NEED THE TIE-UP WITH AIRASIA
A quick analysis on the current state of MAS indicates that they are on the right track. The three key cost factors that need attention are fuel, maintenance and manpower cost. With regards to fuel cost, MAS has taken some steps to reduce the unpredictability of the movement of fuel price. With a bit of tweaking they will get it within control as you cannot totally eliminate uncertainties linked to fuel pricing.
On maintenance cost, the fleet renewal program will start to alleviate the impact of maintenance on the operating profits while shifting the cost towards the interest expense while creating a healthier balance sheet. If at all the national carrier is guilty, it is that the fleet renewal program should have been carried out earlier, say 2007 when MAS would have been able to hive off depleting assets at a higher value and not incurred high maintenance costs which would have increased y-o-y that has negative impact on the operating profits.
The reduction of manpower cost or the rightsizing of this cost can be properly planned through natural attrition and redefinition of job scopes that need key union and association buy in for success. This has always been done as a top down approach but in all fairness, engagement at the shop floor needs to be intensified as it is the personnel at this level that will impact the bottom line in terms of efficiency, productivity and effective implementation.

2. BASED ON THE EFFORTS OF PAST MANAGEMENT, MAS SHOULD REAP THE BENEFITS IN AROUND 2013, THE SHARE SWAP AND INPUT OF AIRASIA AT THIS JUNCTURE ARE SEEN TO BE OPPORTUNISTIC WITH A LARGE DOSE OF VESTED INTERESTS AT PLAY.
The timing of the share swap could not have happened at a worst time as it will largely benefit AIRASIA shareholders even without their own effort and Khazanah has given away a large portion of their net worth in MAS for free. This is blatant mismanagement at Khazanah and a thorough investigation should be launched to
see whether there is any personal/vested interest that has come into play on the decision making for a strategic national asset.

3. MAS SHOULD FOREVER REMAIN IN THE CONTROL OF GOVERNMENT’S HANDS AND SHOULD BE PRIVATISED INSTEAD OF BEING FORCED TO CO-EXIST WITH PRIVATE ENTITIES
MAS is a source of pride for the nation. It started getting into trouble when vested interest came into picture and started to encroach on its balance sheet and profitable entities. While the aviation business model has changed dramatically over the decades and previous laurels of achievement may not be replicated due to the changing times, the aviation space is a critical playing field for the nation. Every country assists its aviation companies in one form or another, so we should not be fooled to think that it’s a level playing field out there.
What is required is a dynamic BUSINESS Model for MAS to prosper further. One initiative that could be explored is to privatize it and fix it rather than the share swap that will work on a model of cannibalisation shrouded under the so-called comprehensive collaboration.

4. MAS AND AIRASIA RUN ON COMPLETELY DIFFERENT BUSINESS MODEL
MAS is a Malaysian company with global reach and serves not only a commercial agenda but a national agenda in terms of promoting Malaysia as a tourism destination, to facilitate trade between countries under a G to G environment and also to facilitate outreach to new destination for strategic and commercial
purposes.
AIRASIA is a commercial entrepreneur driven Malaysian Multi National Company (MNC) having partnering arrangements in each of its chosen point to point country of destination and hub.
Both derive their sources of income from different business approaches and with different objectives in mind. The objectives are not aligned and to align them would result in a different shift in strategy that could have a NEGATIVE impact on both companies' performance, more so for MAS than AIRASIA.

5. COLLABORATION FOR COMMON BENEFIT IS POSSIBLE WITHOUT CROSS SHAREHOLDING IN THE TWO COMPANIES
Collaboration between the two companies is definitely a plus but need not be at the expense of each other and encroaching on each other’s brand identity. What is currently prevailing between the two entities is a healthy competition and it keeps each entity on edge to ensure that they remain relevant aviation entities.
But collaboration such as in the oil and gas space between PETRONAS and EXXON for example for the Tapis fields, SHELL and PETRONAS in the Gumusut-Kakap fields, MURPHY and PETRONAS in the Kikeh fields and a more dramatic win-win partnering arrangement between giants SHELL and EXXON in the Brent oil fields in the North Sea of Northern UK demonstrates the joint collaboration between two competing entities can be achieved without sacrificing each entity’s identity and business objectives. SHELL and EXXON compete in other acreages in other countries around the world. What is needed is sincere partnering for common benefit.

6. KHAZANAH SHOULD LOOK AT ITS SHAREHIOLDING IN MAS AS A STRATEGIC NATIONAL INTEREST STAKE WHILE INVESTMENT IN AIRASIA AS PURELY A RETURN ON INVESTMENT STAKE
The move by Khazanah to invest in AIRASIA should be looked at purely as a commercial investment as it is investing in a company that is majority foreign owned if aggregated. Khazanah should look at AIRASIA for returns on investment and not as a strategic stake. AIRASIA is a company purely running on commercial adrenalin with an iconic entrepreneur. Khazanah has little say in AIRASIA and can easily be outvoted in the event parties invested in AIRASIA work in concert.
Its stake in MAS is crucial as it helps control its own skies while operating a free skies environment. Air travel has become commoditized and should the country be outplayed in the aviation space, we could see colonialisation of our airspace and others gaining more benefit flying over Malaysian airspace.

7. RISK PROFILE TO THE AVIATION INDUSTRY HAS INCREASED EXPONENTIALLY AS KHAZANAH HAS BEEN DRAWN IN TO SUPPORT BOTH ENTITIES IN THE EVENT OF ECONOMIC AND AVIATION DOWNTURN
By having cross shareholding, should anything untoward happens to the industry, Khazanah will have to help 2 entities as it would not make sense for AIRASIA to insist on the share swap if it did not provide them financial ‘cloud cover’. If Khazanah had kept AIRASIA shareholding as a ROI stock, the investment could be unlocked on reaching a specific return. As the shareholding in AIRASIA is only 10%, Khazanah is neither here nor there in terms of being able to influence policy; therefore it makes no sense to undertake a share swap where the vendors of AIRASIA have significant say in MAS but not vice versa.

Thank you.
Any rebuttals and cross examination by Khazanah, Tune Air or any interested parties are most welcome.

Our email address: [email protected] ([email protected]) This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Teg Bahadur

22nd Sep 2011, 19:58

Well, since we are at it I would like to paste this one from the same blog. Hope we will see some response, eventhough I think MAS boys are too cerebrally challenged to dwell upon anything more than maggi mee, sodomee and nasi kangkang!

http://img27.imageshack.us/img27/9524/masairasia.jpg
SAKMONGKOL AK47
Will the ending of this secretive corporate deal be like this? - Air Asia buys over MAS? No, not even that- its finally give Tony what he has always wanted - own a piece of our national airline. That will make him a Prime Minister in the airline industry. Sometime in the future, the Khazanah people together with CIMB I suppose will lend Tony’s Tune Air a lot of money to mop up the entire shares in Air Asia. Then Air Asia will be injected into a listed vehicle like MAS freeing Tune Air from debt. Tony’s share via Air Asia which will then be injected into MAS will be converted into substantial shareholding in our national carrier. Maybe from 20% to 40 pct.

So let’s go back to retrace our steps. Khazanah and Tony and CIMB takes us through the motion making magic before the public eye. They are allowing Tony and company take up 20% of MAS shares under the pretext that Tony and that accountant Meranun can do their magic for MAS. Stupid MAS’s capitalization is at RM 5 billion while Air Asia stands at RM 11 billion. So how can MAS with a shotgun compete with Air Asia which has a rocket launcher? Air Asia is fully loaded firing live ammunition while MAS fires blanks.

Air Asia made more than RM 1 billion profit in 2010 while MAS incurred nightmarish losses despite Jala being there followed by Dato Tengku Azmil. Air Asia has more planes than MAS and MAS owns or leases boneshakers and call itself the airline with the golden service and touch. What a joke and this joke has been allowed to be uttered for too long by incompetent people at MAS and Khazanah.

Then with so many factors assisting Tony and Kamarudin, Mas does indeed make profit. Some bright people at Khazanah will advise the PM to suggest since Mr. TF is already the single largest shareholder of MAS wand he has made profit why not merge Air Asia with MAS?

How? Assist Tony to make Air Asia private and then allow him to inject the new entity into MAS. Give cheap loan to Tune Air to mop up the entire shares of Air Asia and then allow it to be injected into MAS. Tune Air the original owners of Air Asia will be freed from debt and the entire debt is now absorbed into the merged entity of a new MAS. The MAS owners will be Tony and company and Khazanah. Certainly and naturally, that will create synergies (read profits for some people) and hear this, gets protection from the Malaysian government. It’s a long bull****ting exercise but one necessary to lead astray so many pesky bloggers. Some of them buyable but others are not

I am trying to find the one thing that is repulsive about the MAS-AA deal. Why is this attempt by Khazanah in trying to mend MAS our national pride, appears to be a leaving a bitter after taste? What’s so distasteful about it?

My one reservation about this deal is that it shows Khazanah as trustee to the nation’s wealth and therefore enforcer about how our assets are being managed isn’t trying hard or serious enough to keep it national and strategic. Diluting the nation’s share in MAS can also diminish what potential advantages the country can leverage by having a national airline. Every country has one that it leverages on to give it comparative advantages.

The share swap with Tony Fernandes is effectively paying protection money. Give Tony shares in MAS in return of a pledge by Tony that he will not use Air Asia to compete with MAS. It’s a payout to Tony in return for TF‘s promise not to work hard.

It’s also the old game of carving out the monopoly board among business rivals. Better to cooperate rather than bludgeon each other. So will MAS make profit after this after it secures a promise from Tony to not disturb it? The people at MAS appear to blame some unprofitable costs center (such as Firefly) for its losses. And it believes that removing this will turn MAS profitable plus having Tony and whoever else on board will allow MAS to benefit from their skills.

It’s more like better to keep friends close and enemies closer. I go to a friend’s burial not to pay my respects but to make sure he’s dead. So keep Tony on board to ensure he’s not up to mischief which MAS people and by backward linkage, Khazanah people are incapable of dealing with.

READ MORE HERE (http://sakmongkol.********.com/2011/09/mas-aa-deal-once-again-1.html)

Mat Sabo

23rd Sep 2011, 21:55

Typical MAS malaise pundeh logic...ignore, deny and all problems will go away. So no pip squeak from those losers.

sins.sixniner

24th Sep 2011, 06:34

guys no matter wht crap you guys bitching about they still payin our salaries on time hopefully tf will bring changes to the system so get back on the ball like other carriers

tarmaruddeen

24th Sep 2011, 21:08

the only hope for mas to get back to its glorious days is for tf to sack everyone and start afresh. get everyone to reapply, and hire in order of experience and desired qualification NOT KULITFICATION!

roxar

25th Sep 2011, 18:00

scandicstar

25th Sep 2011, 18:53

Air Asia will stopped flying after june 2012 because the a320 are going for a heavy maintainance and they dont even own a hanger.
Buy 20% MAS then used the MAS engineering falilities and staff to do the heavy maintainance. !!

Sireh

25th Sep 2011, 22:39

To roxar and scandicstar.........terima kasih banyak banyak for joining this thread.

Otherwise we get nothing but cuts and pastes from internet blogs which may be true but may cause some cojoneless people to be nervous about replying to.

Telur Belacan

26th Sep 2011, 21:03

From what I hear, they have not paid for previous maintenance work on the B737s; and they have not paid the MAB too. Really a magical operation going places, truly malaysia boleh! How they are going to get the heavy maintenance done for the A320's is anybody's guess...the most probable way would be to get DCA to defer the requirements. Good luck guys!

ipohmali

27th Sep 2011, 20:39

http://www.malaysia-today.net/images/stories/mahathirmohamad.jpg

Dr M says fed up with MAS, backs AirAsia swap deal (http://www.malaysia-today.net/mtcolumns/newscommentaries/43748-dr-m-says-fed-up-with-mas-backs-airasia-swap-deal)

(The Malaysian Insider) - Tun Dr Mahathir Mohamad threw his weight today behind the controversial share swap deal between the national carrier and AirAsia despite strong opposition from the right-wing Malay ground and Malaysia Airlines (MAS) staff against Tan Sri Tony Fernandes’ involvement.
Critics have accused the budget carrier’s ambitious boss of taking advantage of the loss-making national airline to fuel Fernandes’ personal ambitions, the latest being the acquisition of English Premier League club, Queens Park Rangers.
The national carrier will sponsor QPR’s home jersey for the next two seasons, while AirAsia’s logo will be emblazoned on the team’s away and third kits.
The still-influential former prime minister said today he was “fed up”with MAS’ management over the years.
“Government had supported MAS with funds and protection but MAS had never done well,” the country’s longest-serving prime minister of 22 years wrote in his blog today,comparing the two airlines.
In contrast, he observed that AirAsia being a “newcomer” into the aviation industry had defied the odds and grown from a two-plane operation covering four routes into Asia’s biggest budget carrier.
“All I wanted to see is Air Asia’s management playing a role, indirectly or directly in the management of MAS,” said Dr Mahathir (picture).
The 86-year-old appears to be pushing AirAsia to the forefront in recent months,including suggesting, during this year’s Langkawi International Dialogue at Putrajaya last June, the budget carrier open up new routes from Malaysia to several African countries.
MAS and AirAsia inked the deal on August 9, which allows the loss-making national carrier to swap a 20 per cent stake for 10 per cent in Asia’s top money-making budget carrier.
READ MORE HERE (http://www.themalaysianinsider.com/malaysia/article/dr-m-says-fed-up-with-mas-backs-airasia-swap-deal/)

shumway76

29th Sep 2011, 01:16

AA used to send their 737 to MAS for maintenance long ago (under TF), but then stopped it & now sending to Singapore I think.
Reason being is most probably that any aircraft sent to MAS enginineering is never released on time, while in Singapore it's always on time!

Even AAX which has A330 & A340 is not sending to MAS engineering, eventhough MAS has capability for A330 & A340 maintenance.

ipohmali

29th Sep 2011, 06:17

Like TB wrote, if AK (AA... sic ) had been such poor paymasters, then any work for them would have been pushed well down the list of priorities by MAS maintenance.

Kentot Besar

1st Oct 2011, 08:13

Malaysia truly boleh : Malaysian Insider apologised to TR for slander and settled out of court. Amazing isn't it; next slogan, incredible and amazing Malaysia.

roxar

1st Oct 2011, 09:12

Malaysia truly boleh : Malaysian Insider apologised to TR for slander and settled out of court. Amazing isn't it; next slogan, incredible and amazing Malaysia:eek:
nothing new i guess...:}:}:}

Paishinel

2nd Oct 2011, 00:18

Otherwise we get nothing but cuts and pastes from internet blogs which may be true but may cause some cojoneless people to be nervous about replying to.

MAS people are sheeple, chicken littles who are always worried that they will lose the comfort and molly coddling of the mothership should they run afoul of the powers that be. I have friends and relatives in the SB and they intimated that the SB do monitor the blogs, forums and chat rooms. However they are so overwhelmed with the data and information and they narrow their focus now on the immediate threats that plague the ruling regime.

Running scared from engaging in discussions about MAS's problems give the authorities the green light that nobody cares and the culprits can continue with plundering the national coffers through MAS with wanton abandon. The plunderers know that MAS people are scared to expose them ( even when the have access to incriminating evidence ) and they encourage this apathy and denial through their tentacles in MASEU and MAPA. Why do you think that this had been hidden and even when exposed got swept under the carpet with nary an NFA?

Kentot Gemuruh

2nd Oct 2011, 01:29

You are a dangerous subversive:\

You have friends in SB..............yikes, that makes you even more dangerous!

scandicstar

2nd Oct 2011, 08:47

Sireh no problemo,,,,,

Tun Mahathir is angry at MAS because he said the airlines never improved.
I wish he said that infront of a big mirror. TR cannabalised Mas in open day light for so many years during his tenure, Did he ever notice it. Ibrahim LSG given XX years contract. under xxx xxx.
Who actually appointed the Tarbusus to run Mas. ( xxxxxxx Tarbus is an old malay movie).

There were so many unseen hand rigging the airline from the backstage. It is a cash cow , It is so sickening to see that despite the losses and dignity in the drain... MAS sponsored QPR and somebody else getting the name outside Malaysia.........still they are telling blind Malaysian that it is a business and marketing strategy. Wonder whose business was that

scandicstar

2nd Oct 2011, 08:57

Shumway76,

If am going to do a job for somebody and may be not get paid for the job done whilst I have my own job to do, so I might as well take it easy.
AA knew it they can get away without paying Mas or Mab but do that in Singapore. Next thing LKY will lelong their aircraft in Sungei Road. History has proven that AA over 5 years they can get away with daylight robbery by not paying in full . In business track records are vital.

lembujaga

3rd Oct 2011, 04:24

Ipohmari, bad idea to insinuate any wrongdoing of mahathir in this forum. Almost all of the Mara sponsored flyboys and those of TUDM think of mahathir as their god; in their mind without mahathir, Mara would not have sponsored in their flight training them especially with their poor basic MCE/SPM. With mahathir, miracles happened and riff raffs get launched into the aerospace world well above their stations. Have you ever get into a technical, industrial or philosophical debate/discussion with these fellas? Their " depth " and basic understanding about most issues would send your head into an orbit. No wonder the " astronaut '" was able to shake the whole scientific world with teh tarik experiments!

So it's a big no no in trying to shame them into seeing their " god " in a different light. This diabolical kaka kutty is their saviour, deliverer, their Raja Mahdi. Mas boys will curse and swear at your audacity to associate him with anything improper. Be warned!

Vel Paar

7th Oct 2011, 04:20

The Minister in the Prime Minister's Department has declared that TR broke the law; can MAS now pursue criminal charges and civil suits against him to recover the previous losses due to his criminal acts?

See this headline :

Ex-MAS boss broke the law, says Nazri (http://malaysia-today.net/mtcolumns/newscommentaries/43953-ex-mas-boss-broke-the-law-says-nazri)

read this :
Ex-MAS boss broke the law, says Nazri (http://www.malaysia-today.net/mtcolumns/newscommentaries/43953-ex-mas-boss-broke-the-law-says-nazri)

gerago

17th Oct 2011, 18:25

Did the former DFO Dr Don make any headway in his legal suit against Tajuddin? In case the GLCs do win their cases against Tajuddin, will AK assume any of the liabilities?

Sampan Angkasa

19th Oct 2011, 08:15

:{:{:{End of the road for Firefly’s jet service (http://www.malaysia-today.net/mtcolumns/newscommentaries/44230-end-of-the-road-for-fireflys-jet-service)

By Lee Wei Lian, The Malaysian Insider
KUALA LUMPUR, Oct 18 – Firefly’s jet service became a casualty of the strategic collaboration between Malaysia Airlines (MAS) and AirAsia today and the fledging budget carrier will now focus on its turbo-prop fleet.
Malaysia Airlines announced today that all of its subsidiary’s jet aircraft will be redeployed into the parent company’s operations by December 4, 2011 saying that the move addresses the continuing heavy losses being incurred by Firefly jet operations.
Little was known about Firefly’s financials previously as profit and loss statements were never disclosed by MAS.
The national carrier said that it deeply regreted any inconvenience caused to passengers of Firefly Jet services and gave its fullest assurance to passengers that it will honour all jet flight seats sold on Firefly.
The MAS-AirAsia strategic collaboration was inked on August 9 as a deal between the government’s investment holding company Khazanah which controls MAS and unlisted Tune Air which controls AirAsia.
The move renders AirAsia as Malaysia’s only major airline operating in the budget or value segment prompting fears that the collaboration would give rise to an airline industry cartel.
MAS had since last year used Firefly to compete against AirAsia, launching competitively priced flights from KL to East Malaysia and adopting the same low cost model such as charging for meals on board.
A fare war had erupted late last year with Firefly offering 50,000 seats as low as RM9 and AirAsia responding with a million free seats.
It was also seen by some as a threat to the booming low cost carrier despite AirAsia group CEO Tan Sri Tony Fernandes dismissing any such notions

ipohmali

3rd Nov 2011, 22:33

By Shannon Teoh, The Malaysian Insider
The share swap between Malaysia Airlines (MAS) and AirAsia is being probed by Bursa Malaysia and the Securities Commission (SC) for insider trading.
The finance ministry said today that investigations were still ongoing despite the two airlines agreeing to the deal nearly three months ago.
“It will take time because it involves so many accounts and a huge value. So we need to separate those that are genuine and those with inside information,” Deputy Finance Minister Datuk Awang Adek Hussin told Parliament today.
Shares in budget airlines AirAsia had traded for as low as RM3.14 on June 23 and was finally traded at RM3.92 before being suspended on August 8 before the swap was announced.
It later dipped below RM2.80 on October 26.
National carrier MAS was suspended at RM1.60 but climbed to RM1.90 following the deal.
Awang Adek also said there was no need for either company to file any announcement with Bursa if there was no material development prior to the deal as the matter was considered private and confidential.

READ MORE HERE. (http://www.themalaysianinsider.com/malaysia/article/mas-airasia-share-swap-under-probe-for-insider-trading/)

Mat Sapu

7th Nov 2011, 05:18

By Yow Hong Chieh, The Malaysian Insider
KUALA LUMPUR, Nov 6 — Aviation tycoon Tan Sri Tony Fernandes has denied his AirAsia benefited from the RM249 million in federal subsidies paid to its Fly Asian Xpress (FAX) for rural flights four years ago.
Putrajaya said it paid the amount when FAX operated the Rural Air Services (RAS) — flights to rural communities in East Malaysia — between August 2006 and September 2007, after which the service was handed back to flag carrier Malaysia Airlines (MAS)
“Fly Asian Xpress was the sole operator of the Rural Air Services and not AirAsia Berhad. AirAsia Berhad did not receive any financial benefit arising from the RAS operations,” the AirAsia boss said in a blog post yesterday.
“Although the shareholders of FAX were similar to AirAsia Berhad, they ended up losing almost RM5 million of shareholder capital, because the wind-up costs of FAX, including retrenchment payments, were not covered by the government subsidy.”
Fernandes said when RAS was operated by MAS and subsequently MASwings, both carriers similarly incurred significant operating costs, which were also subsidies by the government.
Deputy Transport Minister Jelaing Mersat told Parliament on Thursday that Putrajaya paid RM249 million to AirAsia to subsidise its rural flights to Sabah and Sarawak.
He also said that MASwings needed less than half the amount of subsidy when it took over the routes from the no-frills carrier’s unit subsidiary FAX in October 2007.
“MASwings only needed less than half the subsidy as it is more organised and uses newer aircraft which cost less to maintain,” Jelaing had said.
But Fernandes explained the higher subsidy bill was due to an “abnormally high” number of overhauls and repairs needed for aircraft it inherited from MAS in 2006.
He pointed out that FAX had paid RM48 million in maintenance costs at market rates to MAS Engineering, rather than at cost as had been offered to the national carrier previously.
“With MAS as the only licensed engineering provider, no supplier competition was available to extract better rates,” he said.
FAX also paid RM72 million to a third-party for additional maintenance not provided by MAS as the national carrier had been slow to respond to requests and had wanted to charge higher rates.
On top of that, FAX paid RM25 million for ground handling and other services by MAS; RM16 million on loan spares from MAS; RM9 million for pilot secondments from MAS between August 2006 and March 2007; and footed a write-down on spares worth RM9 million.
“Finally, another contributing factor in the difference in subsidy claims is the higher global fuel price versus prior years under MAS: RM10 million,” Fernandes said.
“MASWings benefited from the amount spent by FAX because 80 per cent of the amount spent would not have to be incurred in the 12 months after MASWings took over,” he added.
The return of RAS routes to MAS after just 14 months had raised concerns of whether it would affect the national carrier’s turnaround plans under then-chief executive Datuk Seri Idris Jala.

READ MORE HERE. (http://www.themalaysianinsider.com/malaysia/article/airasia-denies-gain-from-subsidies-for-rural-service/)

scandicstar

11th Nov 2011, 13:58

Everybody can deny

Amitabh Belacan

12th Nov 2011, 08:57

He can deny for all he wants but if the present do collapse in the coming GE13, we are going to dig into the paper/electronics trail into his scams.

We all have a sneaky feeling that the recent MAS/AK share swap offer opportunities for this crook and his patrons to make hay when the sun still shines.

scandicstar

13th Nov 2011, 12:56

Amitabh, then Everybody Can Go To Jail....

salahbensilap

16th Nov 2011, 00:00

Now, is this outburst of a sandiwara a novel way to get the politico patrons to help him wriggle out of paying...after collecting billions from passengers who faithfully dished out the taxes included in their fares?

AirAsia boss vents anger on MAHB (http://www.malaysia-today.net/mtcolumns/newscommentaries/44973-airasia-boss-vents-anger-on-mahb)

(Bernama) - AirAsia Bhd’s group chief executive officer, Tony Fernandes, has called off a press conference on airport tax which was scheduled later today.
However, he used the social media, Facebook, to vent his frustration at the issue, saying airport taxes should be lower to make them afforable to the common people.
“AirAsia has been fighting to make them cheaper for the common man. Airport taxes are paid by Malaysians and the passengers.
“The money doesn’t go to AirAsia but Malaysia Airport Holdings Bhd (MAHB),” he said in his Facebook today.
He said Malaysia Airlines and AirAsia had given Malaysian airports ideas to increase their income by attracting more airlines.
“Then reduce the charges,” he said.
Fernandes said there were too many empty promises made by Malaysian airports and the airlines were blamed for their poor performance.
“AirAsia wants MAHB to come clean. The new Low-Cost Carrier Terminal (KLIA2) was supposed to be operational in June 2012 and cost RM2 billion,” he said.
It has been reported before that the cost of KLIA2, which has the capability to handle 30 million passengers, will cost more than the initial figure of RM2 billion.
Fernandes also questioned the need for a third runway at the Kuala Lumpur International Airport (KLIA).
“Why is KLIA building a third runway when they don’t use dual mode on two runways? Heathrow has 60 million passengers with two runways.
“Fixing the air traffic system would have been cheaper than building another runway,” he said.
On criticisms from four MPs, Fernandes said they had made it very personal.
“Villagers could never fly before. We have worked so hard to make flying affordable and 130 million people have flown due to us,” he said.

mokham

16th Nov 2011, 19:02

Over the years, there have been persistent rumours that AK had never paid MAHB and DCA for the services rendered. Likewise MAS bean counters had intimated that AK had been poor paymasters for maintenance work done for it. tf had been able to get his patrons in the corrupt Malay government set up to help write off all these unpaid expenses. AS I said, there were rumours but I gather that there is no smoke if there isn't a fire.

The deafening silence amongst Malaysian aviation professionals certainly enbolden the corrupt and greedy quarters in the business to rip off the average Malaysian taxpayer and consumer. The in house MAPA forums are nothing short of utusan moolayu garbage with lots of hot air and curry flavoured farts!

Mat Sapu

22nd Nov 2011, 17:56

The real winners in Air Asia-MAS deal (http://www.malaysia-today.net/mtcolumns/special-reports/45169-the-real-winners-in-air-asia-mas-deal)

SPECIAL REPORTS (http://www.malaysia-today.net/mtcolumns/special-reports)

http://img267.imageshack.us/img267/3194/tonyfernandez.jpg
It looks like the little Napoleons in Khazanah are the ones who will benefit most from the controversial share swap.
Here, the truth of the matter is that Tony has had it up to his eyeballs with the little Napoleons at Malaysian Airports Holdings Berhad (MAHB) for virtually extorting him over the years through excessive fees. He sees the badly-managed MAHB as a leech, sucking Air Asia’s blood for all it is worth.
Joe Fernandez, Free Malaysia Today
Who are the real beneficiaries in the controversial Air Asia-Malaysia Airlines share swap? The answer should not be as confusing as has been made out to be in media statements from all and sundry.
Air Asia Chief Tony Fernandes isn’t being very helpful, and for obvious reasons. He fears that millions of his doting fans will abandon him and, in consequence, he will lose his throne as the God of Marketing in Malaysia and the region, if not the world.
We are told that Khazanah Nasional will have a 10% stake in Air Asia in return for the latter having a 20% state in Malaysia Airlines. Khazanah Nasional has a 17.33% stake directly in Malaysia Airlines. Indirectly, it has a 52% stake through Penerbangan Malaysia Sdn Bhd, its wholly-owned subsidiary.
There’s more than meets the eye in this cloak-and-dagger deal.
Tune Air Sdn Bhd, a private limited company which has a 20% controlling stake in Air Asia, is owned 50:50 by Tony and his partner Kamarudin Meranun. This means that each has a 10% stake in Air Asia through Tune Air.
Khazanah, for all practical purposes, did not enter Air Asia directly. But like Tony and Kamarudin, it went in through Tune Air. The 20% that Tune Air has in Air Asia is now owned 50% by Khazanah and 50% by Tony and Kamarudin.
Khazanah, in reality, now owns half of Tune Air. Tony and Kamarudin both hold the rest in equal measure. In return, Tony and Kamarudin accepted a 20% stake collectively in the virtually bankrupt Malaysia Airlines. Many will say that the two need to have their heads examined.
The bottom line is that buddies Tony and Kamarudin have both lost their once controlling stake in Air Asia via Tune Air.
The little Napoleons at Khazanah can go on to pick up Air Asia shares in the open market and build up its ownership of the airline outside Tune Air. The revenue from Air Asia is expected to help feed the war chest of the little Napoleons at Khazanah.
This is part of the real story that Tony isn’t telling anyone. Instead, like Kamarudin, he deliberately keeps mum on the deal while the media goes on a wild goose chase. Both men must have laughed their heads off recently when several MPs attacked Tony in Parliament over the share swap.
It’s a bit of a mystery why Tony and his partner gave up their controlling stake in Air Asia.
Under Tony, Air Asia had bragged from its inception that Now Everyone Can Fly. We can only guess at what his real motives are in accepting a deal with Khazanah so that Not Everyone Can Now Fly.
There was that story not so long ago that Air Asia would shift its headquarters to Jakarta. This was shortly after Tony started singing praises of the Indonesian capital. The Air Asia chief saw Indonesia as El Dorado and the Promised Land all rolled into one as Air Asia Indonesia was poised for as much success as Air Asia in Malaysia.
Genius plan
When caught with his pants down over the headquarters announcement, he quickly claimed that Air Asia would still keep its headquarters in Malaysia. Jakarta, he said, would be Air Asia’s Asean headquarters since that’s where the Asean Secretariat was located.
Apparently, he wanted to have a “closer working relationship” with the Asean Secretariat since Air Asia was in fact THE Asean Airline. If that’s the case, what role would the so-called Air Asia headquarters in Malaysia still play? Air Asia would end up with two headquarters under Tony’s genius plan.
Since the share swap deal, we have not heard anything about Air Asia’s Asean headquarters in Jakarta. Instead, we are told that Tony will set up a new airline—Caterham Jet—ostensibly to compete with, among others, Qantas in its plans for a new airline for the super rich in the region. Not Everyone Should Fly? God alone knows.
Here, the truth of the matter is that Tony has had it up to his eyeballs with the little Napoleons at Malaysian Airports Holdings Berhad (MAHB) for virtually extorting him over the years through excessive fees. He sees the badly-managed MAHB as a leech, sucking Air Asia’s blood for all it is worth.
The way he reckons it, he works hard only to see MAHB robbing him of the fruits of his labour and constantly blackmailing him. He is still sore that it denied him the right to build a new low cost airport near the Kuala Lumpur International Airport. Instead, MAHB decided to build its own—for the lucrative private contracts that the little Napoleons could take for themselves—and confine him to using their new airport.
MAHB even enlisted the support of former prime minister Dr Mahathir Mohamad, the omnipresent, to lobby public opinion against the new airport planned by Air Asia. Many stories in the Malay media on the issue bordered on the personal, were highly offensive and even downright racist.
That Air Asia has been a runaway success in Malaysia from the word “go” is in no doubt whatsoever. It has replicated and duplicated this success through subsidiaries in Thailand, Vietnam and the Philippines, besides Indonesia.
READ MORE HERE (http://www.freemalaysiatoday.com/2011/11/22/the-real-winners-in-air-asia-mas-deal/)

Hogger60

23rd Nov 2011, 00:38

PETALING JAYA: Datuk Eddy Leong (http://archives.thestar.com.my/search/?q=Datuk%20Eddy%20Leong) (pic) has called it a day at Malaysia Airlines (MAS) (http://archives.thestar.com.my/search/?q=Malaysia%20Airlines%20%28MAS%29).
Sources said he submitted his resignation letter to the new management of the airline yesterday.
Leong is believed to be negotiating on the date he could leave because there needed to be a transition period for the handover of duties.
http://biz.thestar.com.my/archives/2011/11/23/business/b_2leong.jpg Eddy Leong
He was chief executive officer of Firefly and chief operating officer of MAS’ short-haul operations.
Leong had been given the task to help the new team drive Firefly’s turboprop operations and at the same time operationally lead the new short-haul operations of the national carrier.
The reasons for his resignation after nine years with the airline are unclear but it is learnt that he had another offer.
He is the fourth top executive of MAS to resign within five months.
In July, senior general manger of marketing Datuk Bernard Francis (http://archives.thestar.com.my/search/?q=Datuk%20Bernard%20Francis) announced his resignation after six years with the airline.
On the day the share swap with AirAsia (http://archives.thestar.com.my/search/?q=AirAsia) was announced, then managing director Tengku Datuk Azmil Zahruddin (http://archives.thestar.com.my/search/?q=Tengku%20Datuk%20Azmil%20Zahruddin) resigned.
Early this month, chief financial officer Mohd Azha Abdul Jalil (http://archives.thestar.com.my/search/?q=Mohd%20Azha%20Abdul%20Jalil) threw in the towel after 4½ years with the airline. His last day is the end of next month.

babasinkeh

23rd Nov 2011, 06:38

The so called little napoleans are operatives of the patrons and handlers of the bangla look alike tony francis. These morons only have taste for ill gotten gains with no sense of how much can be milked from the cash cow without causing haemorrhage. I am sure tf is mighty worried that once these hyenas are through, he may have little left for himself!

Mat Sapu

2nd Dec 2011, 02:24

AirAsia: Stop harassing our staff (http://www.malaysia-today.net/mtcolumns/newscommentaries/45427-airasia-stop-harassing-our-staff)

The Star) - AirAsia has issued an official warning letter to Malaysia Airports Holding Berhad (MAHB) for allegedly harassing its staff.
The company’s commercial director Jasmine Lee claimed MAHB had told airline staff to remove the “Say No to Airport Tax Increase” stickers on their uniform. She claimed that the airport operator also removed posters at their sales counters at LCCT.
“They even went to the check-in counters and told our staff not to wear the stickers and to stop sticking them on passengers’ boarding passes.
“We have sent an official warning letter to request that MAHB’s officers stop unlawfully obstructing our staff from doing their jobs,” she said, adding that the incident occurred from around 10am until lunchtime yesterday.
AirAsia is protesting against the decision by MAHB to increase the airport tax by RM7 and RM14 at five airports nationwide which took effect yesterday.
The airports are Langkawi International Airport, Penang International Airport, Kuching International Airport, Terminal 2, Kota Kinabalu International Airport and the low-cost carrier terminal (LCCT) at KLIA.
Lee also alleged that MAHB confiscated security tags from some staff working in restricted areas.
“This incident will not deter us. We will continue to wear the stickers tomorrow and will put back the posters,” she said.
AirAsia CEO Tan Sri Tony Fernandes later tweeted: “Malaysian airport staff tearing down our posters and taking away airport passes of our staff. And using intimidation. Can someone tell them this is Malaysia and not a police state.”
MAHB senior general manager for operations Datuk Azmi Murad, who was present during the incident, denied any harassment or intimidation took place but admitted they removed the posters.
“They were putting the posters in public areas and we took them down. Imagine if anyone could just walk in and start putting posters everywhere,” he said.
AirAsia has taken a full-page advertisement in The Star, urging the public to call MAHB and give their opinion on the increase in airport tax.
“AirAsia views this increase as not justified as the current airport facilities are not up to par,” said the advertisement.

Paishinel

6th Dec 2011, 05:48

This Jasmine is crying foul about MAHB's tightening of screws; looks like the red capped fat bangla may have lost his mojo bag with the little napoleons who are all out to make a buck or so when the going is still good.

jetjockey696

6th Dec 2011, 09:48

I guess uncle Tony is losing his magical powers...over his kingdom. Dictator of airlines of malaysia. His generals are stirring for a coup d'état.:ok:

Bersama 5th 2011

The fued between AirAsia Bhd and Malaysia Airports Holdings Bhd (MAHB) took a turn for the worse when the low-cost carrier today refuted claims by the airport operator that AirAsia was the main reason for the cost of the new low-cost terminal, or KLIA2, to increase substantially.

In a statement here Monday, the low-cost carrier also said it did not ask for a bigger KLIA2.

AirAsia has called for a press conference tomorrow at its headquarters in Sepang to refute MAHB's claims of asking for a bigger KLIA2.

The budget carrier also provided copies of two official letters sent by AirAsia to MAHB and vice versa to prove that it should not be blamed for the price tag of KLIA2 to almost double.

AirAsia, MAHB's biggest customer, said its chairman, Datuk Abdul Aziz Abu Bakar, had in a letter on November 2009 to MAHB managing director Tan Sri Bashir Ahmad Abdul Majid, cautioned that the location of KLIA2 at KLIA West was not suitable and would cause construction costs to soar.

"The site will definitely be more expensive than the planned budget of RM2 billion," AirAsia said, adding it had also estimated for MAHB that the construction cost will increase to RM3.6-RM3.9 billion.

In a separate letter dated Aug 9 this year, Bashir had written to AirAsia X chairman, Tan Sri Rafidah Aziz, claiming that the proposed KLIA2 would be sufficient to handle 30 million passengers per annum.

"This figure has never been officially changed by AirAsia or MAHB since Aug 9, 2011," AirAsia said, in refuting claims made by MAHB in an article entitled "Why KLIA2 has to be bigger" posted on its website.

According to the article, MAHB claimed that AirAsia had been the one to estimate that passenger traffic at the new terminal would reach 28.7 million by 2015, 45.3 million by 2020 and 60.3 million by 2025.

AirAsia chief executive officer, Tan Sri Tony Fernandes, had also dismissed MAHB's justifications for doubling the cost of KLIA2 from its original RM2 billion estimate in 2009 to RM3.9 billion currently.

AirAsia had mentioned in a letter that the airline should not be held accountable for cost over-runs arising from the incorporation of these needs.

The airline also refuted MAHB's claim that it had asked for a fully-automated baggage handling system (BHS), which is believed to have caused delays in construction, saying it had only asked for a semi-automated BHS.

"The MAHB board had unilaterally decided on a fully-automated BHS to accommodate 45-60 million passengers, which was again not agreed to by AirAsia," it said.

AirAsia said its request for a 3,000-metre runway had been based on its original requirement to MAHB to cater to the wide-bodied Airbus A330 aircraft, which were operated by Air Asia X.

Later, the airline said, MAHB has since shortened the runway length to 2,750 metres, which can only cater to the A320 aircraft, without consulting AirAsia.

"As such, this should not be considered as an additional request/requirement from AirAsia as the original plan has always been for a 3,000-metre runway.

"Therefore, no additional cost should be incurred," it said.

Bersama 6th 2011

In the latest twist to the feud between AirAsia Bhd and Malaysia Airports Holdings Bhd (MAHB), the budget carrier today expressed its hope to work as a family and for the airport operator to give fair consideration to the airline's requirement in the new low cost terminal (KLIA2).

AirAsia Chief Operating Officer Bo Lingam said the airline would be the biggest company to utilise the new airport but some of its proposals and basic requirements were not entertained by MAHB.

"As per the meeting between MAHB and AirAsia which was chaired by Datuk Seri Najib Tun Razak, who was then Deputy Prime Minister, it was proposed that both the entities form a joint committee on the development of KLIA2.

"However, until now, there has been none. Although its quite late now, we are still open for a joint committee for the benefit of AirAsia, MAHB and all related parties in the development of the airport.

"Had the joint committee been formed, all these problems would not have cropped up as it would have been resolved internally," he told a media briefing here today.

He said the airline's main concern was the cost escalation of the new terminal which would result in higher rental, surcharges and extra bills imposed on AirAsia, when the company moves its operations to KLIA2 scheduled to operate in 2013.

This, he said, may also be a reason for AirAsia to increase its fares in future.

"Besides, we are requesting that MAHB agree to have a service level agreement with us to occupy the new airport as we have no such agreement now with the present low cost carrier terminal.

"We also want MAHB to state in black and white the current airport charges so that it will not be raised once we move to the new airport," he said.

Bo Lingam said the airline also requested for a taxiway to be built in the first phase of the new terminal and this was infact slated in the airport's initial runway plan, but the plan was aborted.

It has now been planned for construction in the second phase of the project.

"If the runway is not constructed, we are going to incur losses amounting to some RM40 million, annually, only on fuel, because we have to cross the runway without a taxiway," he added.

Bo Lingam also said AirAsia does not deny the fact that MAHB and the airline company had a total of 47 meetings on the new airport project.

"However, no decision was taken at the meetings. It was more one-sided with us presenting our latest plans and proposals and all they said was that the board would meet to deliberate and make a final decision.

"We want a low-cost airport, our operating procedures does not require a world-class airport. We have told them (MAHB) this many times but the latest development clearly shows that they are not getting what we are trying to prove here," he said.

Bo Lingam said in 2009, the company identified a piece of land and drew up a sample airport design.

"The cost of the project, if based on that design, would not have cost more than RM700 million, but without any reason, MAHB rejected both the site and design.

"We already know that the current site will incur more cost and work because the soil is soft but MAHB make the final decision and now the date of completion is being delayed from year-end to September 2013," he said.

He also said due to the delay, AirAsia had to defer new aircraft delivery due to space constraint.

"We are now talking with MAHB and related parties on securing a piece of land to park the new aircraft until the new airport is ready because we cannot keep deferring aircraft delivery just like that," he said.

AirAsia, Bo Lingam said had helped Malaysia place itself on the world map as one of countries offering low-cost travel.

"So, what's wrong if MAHB grants us a business partner relationship in this particular matter," he said.

AirAsia and MAHB are sheduled to have their update meetings on the new airport tomorrow.

MMBenar

12th Jan 2012, 11:10

Recent developments are really disturbing...MAS is going to reduce frequencies on the lucrative kangaroo route and AAX is going in to pick up the extras. Looks like MAS is slowly but surely being stripped off the choice cuts.

How are MAS employees and the taxpayers going to take it? Turn 180 and open the back dooors for continuous shafting by the ruling regime's cronies?:ugh::ugh:

scandicstar

12th Jan 2012, 16:40

MM benar.

Satu lagi projek oleh Kerajaan Barisan Nasional.

Old Parr

12th Jan 2012, 23:53

It's all so sad to see the national flag carrier come to this. Apathy, apathy, apathy...sh*t, sh*t, sh*t like a certain ee BRA him shouted once - what has come of this wau bulan!!!

The country has gone down the drain, all its institutions rotten to the core and now, my rice bowl is brought down by greedy diabolical forces anti clockwise down the jamban. Sigh, sigh, sigh.

The evil in the world flourish because the good people did nothing, so opined Mohandas Karanchand Gandhi.......how true. All the good people in MAS and Malaysia sit and watch, happy with the little crumbs that came our way. We called the brave ones who ventured out " traitors ", not knowing the real traitors within wreck havoc to our rice bowl and the national flag carrier we love so much. Going for A380 course well ahead just to screw up some more deserving seniors.........ya, yeh, yeah, lato g string is sure proud of his prodigies by default!:{:{:{

Teg Bahadur

13th Jan 2012, 02:16

MAPA's hisapputing is one up on lato gur g-string who used MAPA office to up his membership number........hisapputing leapfrogged over seniors to go up the b744 and now A380. See the pattern, no? You still no see huh? You guys brain dead or what?

chintanmanis

13th Jan 2012, 08:05

History repeating itself in another guise. The ones with out principles and scruples unfailingly screw the deserving ones in MAS. What else is new? MAPA is duty bound to maintain the sanctity of the seniority system and fairplay in particular....:ugh: Someone wrote in some other thread that the politics in MAS mirror that of the rotting bolehland, sad but very very true. The people let BN run wild with the blatant looting, unfair practices, utter irrational polices. Likewise in MAS, the little tuans f**k the whole company and all the nice things up. What can we do? What can you do? What can I do...let's call for an EGM and get hisapputing out!

cav-not-ok

17th Jan 2012, 05:43

With all these A330s arriving this year, who is going to crew them? I understand they cancelled the recruitment.

crew them? where they gonna go? even if you go down to klia now, it's practically an aircraft showroom...

James' Bro

17th Jan 2012, 08:35

cav-not-ok

correction.. a "wau bulan" aircraft showroom :hmm:

Billi360

17th Jan 2012, 15:51

Pass to AAX?

billi361

19th Jan 2012, 06:27

Hello everyone...

Just wondering where is MAS 'adviser' in all of this?:bored:

jetjockey696

19th Jan 2012, 14:50

OK THis article is slightly old blog.. from a malaysian journalist..... but we all learn from the past and the mistakes... but some....:ugh:

rocky's bru: Why SIA is worth S$18.7 b and MAS is worth RM7.2 b (http://www.rockybru.com.my/2010/08/why-sia-is-worth-s187-b-and-mas-is.html)

and this blog from blog spot (********) is from angry pax or ex-employee.... i think...

http://airasiaannus.********.com/

Langkasuka

7th May 2012, 05:31

Hi all, would like to revive this thread after finding this on cyber news. Read on:

I am all for free market competition, I absolutely abhor the "protection still being given" to other quite silly industries we need not have such as autos, cement, steel and IPPs. However, the government failed to recognise the lumbering giant in MAS and basically allowed for "unfair advantage" to Air Asia. *They should have removed the 'shackles' from MAS first before allowing Air Asia in.

Malaysia-Finance ********

The deluge of opinions on MAS-Air Asia saga have been dominating business pages. I have not spoken on the matter for the longest time, but its a brilliant textbook case of what is wrong with Malaysian government linked companies' strategies.

The Blame Game
Former MD of MAS, Tan Sri Aziz Abdul Rahman said that the rot started 15 years back. The highly regulated environment forced MAS into a corner. That the authorities failed to appreciate MAS' role and responsibilities and allowed Air Asia to compete, albeit unfairly, with MAS. Yes, that is absolutely correct. The government did not reassess MAS' position when it allowed Air Asia almost a free hand.*

MAS is not just any company, it was set up with a strong historical legacy, and with it came a lot of baggage and was burdened with a lot of routes it had to do, not necessarily profitable. MAS airfares was also controlled to a large extent.*

I am all for free market competition, I absolutely abhor the "protection still being given" to other quite silly industries we need not have such as autos, cement, steel and IPPs. However, the government failed to recognise the lumbering giant in MAS and basically allowed for "unfair advantage" to Air Asia. *They should have removed the 'shackles' from MAS first before allowing Air Asia in.

The Tajuddin Factor
Well, we know who was behind that saga, and that basically further locked MAS into a long period of vegetation, without any long term plan to match the competition from the 90s till early 2000. There was no coherent strategy to counter the advent of budget airlines.

Positioning
MAS would have been better prepared if it had known its position in the market place. KL is not a business hub, you can try but you have to acknowledge that it will never match Singapore and HK. Malaysians were not aggressive international travellers to start with. Yes, nowadays the situation has improved somewhat but not 10-15 years ago. Hence the international routes, especially to Europe and the US were deadbeats.*

Can MAS Return To The Black Consistently?
Yes, but it must shrink its size and reach. You can market yourself as the premium airline but you know you are competing with Cathay Pacific and Singapore Airlines for the same catchment. How many of us take the other two airlines when we travel longer distances instead of MAS, that answer in itself is what's debilitating MAS. When you add the fact that HK and Singapore are also business hubs, they already have natural substantive load factors for most international routes. Hence they can play the market share game by offering Malaysians low fares to connect to other international routes via Singapore and HK (you can also lump Qatar Airways and ANA into the same boat), something MAS cannot do. *When they already have pushed past breakeven load factors, to steal market share from MAS is something they will gladly do even at a loss.

The National Prestige
Just because its our national airline does not mean we will ALWAYS MUST fly to New York, LA, and other major European routes. Routes management must be "profitable and can leverage" on existing business model for your passengers. So what if MAS only flies to half their current routes? Most important is to stay relevant and profitable. The amount of money being pumped in is basically our money.

Air Asia
As many as there are admirers, there are detractors. Did they get an uneven handed leg up in the early days? Yes, but it wasn't even a GLC. Fine, I say if it wasn't going to Air Asia, it will always be someone else with a similar business model. Be glad that its Air Asia. There are tons of budget airlines but which has been better managed than Air Asia? Like it or not, the company has a clear idea of their catchment passengers. They know the middle class of Southeast Asia will be major air travellers.*

If they did well in Malaysia because of certain favours? You certainly cannot begrudge it for doing just as well in Thailand and Indonesia, can you? They are doing it so much better than any budget carrier in the region, and possibly its the best managed budget carrier in the world, even though Fernandes did not invent the industry.

MAS-Air Asia Tie Up
It should have gone through. Only by lining up interests will MAS get a chance to survive. Now, more than half of MAS routes compete unfavourably with Air Asia, how will you compete? Your premium international routes are also in trouble as well with the problems elucidated earlier. Basically, to survive, MAS will have to be another Air Asia, now why do you want to do that all over again?

If it was me, I would have done an even larger share swap, maybe 30% for 40%. Yes, the flip flop by the government to appease the 22,000 employees union was unnecessary, it just prolongs the pain.*

Read more at: http://malaysiafinance.********.com/2012/05/fate-of-mas.html

jetjockey696

10th May 2012, 10:06

Since the merger:p between MAS and AirAsia didnt go through... the officials is is trying to save something by saying....and put a positive spin on the negative since elections are soon..

AirAsia & MAS Look To Create Intensive Win-win Collaboration Areas
AirAsia and Malaysia Airlines are currently discussing ways to create intensive collaboration areas while maintaining a win-win situation.

AirAsia Chairman Datuk Aziz Bakar said discussions are currently ongoing between both parties, without any sort of interference from the government.

"We are still trying to finalise matters with Malaysia Airlines on the whole aspect of collaboration. No exact timeline can be stated for the moment.

"Both airlines are looking at the right module and proposals on collaboration after the swap deal was dropped.

"We are creating a win-win situation. To us at AirAsia, whatever we do must be a win-win scenario, whether its a share swap or collaboration. If not why would we want to sign in the first place," he told reporters at a signing ceremony between AirAsia, Educational Testing Service (ETS) and Eshia & Associates Sdn Bhd, here.

Asked if AirAsia, through its long-haul affiliate AirAsia X, would revive its currently suspended routes to Mumbai, New Delhi, Paris and London, Aziz Bakar said: "No. That decision stays."

On May 2, Khazanah, the biggest shareholder of Malaysia Airlines, officially called off the share swap deal.

The investment holding company transferred its 10 per cent or 277,650,600 ordinary shares in AirAsia back to Tune Air, which in turn, gave its 20.5 per cent or 685,142,000 ordinary shares in Malaysia Airlines back to Khazanah.

-- BERNAMA

Malaysia Airlines And Airasia Making The Right Moves, Say Analysts

May 6 (Bernama) -- The supplemental collaboration agreements (SA) signed between Malaysia Airlines and AirAsia will pave way for the country towards becoming a regional airlines maintenance hub, say analysts here.

Vice-President, Head of Retail Research, Affin Investment Bank, Dr Nazri Khan said under the SA, both airlines have agreed for a joint venture in procurement and maintenance activities, which are seen as good moves and a huge business opportunity.

"That means they want to buy airplanes together. Component parts will be bought together (through a joint venture company) so it will make Malaysia a regional maintenance hub, if they work together," he told Bernama in an interview here today.

It was reported that the procurement initiative between the airlines is expected to lead to efficiencies by exploring the potential of outsourcing their procurement activities to a mutually owned joint venture (JV) company.

Among the key areas to be explored could include high spend items such as fuel, insurance, information technology and communications.

As for the aircraft component maintenance, support and repair services, he said the airlines would jointly explore the setting up of a JV, including identifying its viability and structure.

Nazri said at the moment, the national carrier's balance sheet was not strong with only RM1 billion cash in hand and RM3 billion in bonds.

He said the airline would need to have another RM2 billion to fulfill the capital expenditure of RM6 billion this year.

When asked whether Malaysia Airlines will go through another round of cost-cutting, he said the airline had done a lot of cost-cutting with two transformation plans over the past decade.

"I think it is rather restricted. Malaysia Airlines and AirAsia have different models so the airline should learn from Singapore Airlines (SIA) rather than AirAsia.

"The SIA during a volatile period, spent more on service to win customers loyalty so I think cost-cutting is not feasible. Air Asia is different as it plays on cost effectiveness," he said.

-- BERNAMA