Capital A turns down RM500m Danajamin’s facility


CAPITAL A Bhd, formerly known as AirAsia Group Bhd (AAGB), will not be proceeding with the RM500 million club facility under Danajamin Nasional Bhd’s Prihatin Guarantee Scheme secured recently as it is unable to accept certain conditions. 

In a filing to Bursa Malaysia yesterday, the low-cost airline and tech company stated that it will explore other available debt financing alternatives with acceptable terms suitable to the operations and financing requirements of the company. 

According to its exchange filing yesterday, major shareholders Tan Sri Dr Tony Fernandes and Datuk Kamarudin Meranun were “unable to accept and/or fulfil certain conditions”. 

“It is currently under extension relief period for AAGB to remedy its consolidated shareholder equity to be above RM40 million and 25% of share capital or for the group to obtain a time extension to provide the regularisation plan for the matching tenure of the club facility,” the filing said. 

On Oct 5, 2021, AAGB received approval from Danajamin for an 80% guaranteed loan of up to RM500 million under the Danajamin’s Prihatin Guarantee Scheme. 

The scheme is part of Malaysia’s economic stimulus package following the outbreak of the Covid-19 pandemic. 

The loan has been approved by AAGB’s lenders under a club deal term financing (Club Facility), with the aforementioned guarantee to be provided for the Club Facility 

by Danajamin via Syarikat Jaminan Pembiayaan Perniagaan (SJPP), a wholly owned entity of the Ministry of Finance. 

The guarantee from the government via Danajamin/SJPP is a strong signal of support for AAGB as the group gears up to ensure it is in a robust position to once again serve the nation and the communities it operates to, playing a key role in rebuilding the economy, as the country emerges from the Covid-19 pandemic. 

The financing under the Club Facility is earmarked for working capital purposes, which will support staff costs and key operating expenses such as aircraft maintenance as AAGB prepares to ramp up its operations leading up to the re-opening of interstate and international borders in the near future.