Malaysian aviation group Capital A, formerly known as AirAsia said 16 June it was evaluating fundraising options for a planned US listing, as it looks to shake off its classification as a financially distressed firm by Malaysia’s stock exchange.
Capital A was hammered, like most airlines around the world, by the COVID-19 pandemic and government-imposed restrictions. Malaysia’s stock exchange classified the company as financially distressed, or a PN17 status, in January, which means it could be de-listed by the exchange if it fails to stabilise its finances within a set time frame. Capital A said it has received a “clean audit report” by auditors Ernst & Young “denoting confidence in Capital A’s ability to continue business for the future”, the company said.
Capital A CEO Tony Fernandes said “The clean audit report is a key step forward to expedite removal of PN17 status which we are confident of exiting in the coming months. The PN17 regularisation plans are on track, which the management team is developing, taking into consideration multiple solutions without proposals for capital dilution or equity raising. We are confident of meeting the deadline to submit the plan to Bursa Malaysia by early January 2023.”
Citing strong air travel demand and plans to recover to pre-Covid capacity, he added, “Our airlines have strategic plans in place to paint the skies red once again with a leaner and more robust model for a successful and viable operation for the future. On the digital side, we will continue to forge ahead with our ambitions to become the leading super app of choice in Asean, Teleport to be the leading logistics provider with the best and fastest coverage and BigPay to be the neobank that provides the best value across our suite of financial products. We strive to be the preferred choice for customers in delivering the best value and high quality at the lowest cost for everyone.”
Elaborating on plans to list AirAsia or digital businesses in the US, Fernandes said, “The group is evaluating all fundraising options, including private placement, direct listing or listing via a merger with a SPAC (Special Purpose Acquisition Company)”, adding that “listing in the US market would be attractive given the liquidity and the diverse investor reach that it can provide.”