by ASILA JALIL / pic by BLOOMBERG
AIRASIA X Bhd (AAX) states that it has completed its debt restructuring and will be able to reverse RM33 billion of liabilities and provisions for liabilities back to profits in the next quarter.
In a statement yesterday, the low-cost carrier stated that it has lodged the Sanction Order for its debt restructuring with the Registrar of Companies with the formalities of the restructuring now completed.
The debt restructuring proposal was approved by its creditors on Nov 12, 2021, and by the High Court of Malaya on Dec 16, 2021.
It stated that the lodgement of the Sanction Order means the financial effects can be recognised in the financial statements of the company and as a result, AAX will be able to reverse RM33 billion of liabilities and provisions for liabilities which have been waived under the scheme.
“The full effects on the income statement and balance sheet of the company will be reflected in the next quarterly Bursa’s announcement. The lodgement of the Sanction Order will now pave the way for the completion of the proposed fund raising,” it noted.
AAX CEO Benyamin Ismail said it is another significant step in rebuilding the company after the Covid-19 pandemic.
“We are returning to the skies in a robust position where we can once again offer the best value fares and customer service excellence which our customers deserve.
“Cargo has been a strong lifeline for AAX and our recovery is already underway as a combination carrier with equal emphasis on cargo and passenger revenues,” he stated.
He added that AAX is looking forward to offering more value for money services across its core network in tandem with cargo and consumer demand.
The company will recommence passenger services to several more international destinations in line with borders reopening, with offerings for guests particularly customers that have travel credits with AAX.
AAX, which is part of AirAsia Group Bhd, embarked on the restructuring in 2020 as Covid-19 halted travel demand and grounded thousands of planes globally.
Under its debt restructuring plan, AAX aims to reconstitute RM63.5 billion of its debt into an acknowledgement of indebtedness for a principal amount of up to RM200 million.
It also affirmed passengers affected by its debt restructuring will be entitled to receive compensation under its scheme through a small amount of payment.
AAX shares rose 11% or six sen to 60.5 sen on the news. Malaysia is set to open its borders on April 1 onwards which should help airline companies and tourism related businesses to revive themselves.