UPDATED: AirAsia owner says capital raising “done”, reports say

A private placement to raise 1 billion ringgit ($226 million) by Malaysia’s Capital A, owner of low-cost carrier AirAsia, was “done”, Group CEO Tony Fernandes said on Monday, as the company edges closer to completing a reorganisation plan. Various media reports quoted Fernandes as saying “We have a 1 billion (ringgit) placement, where there has been various stories, but I can confirm that it’s done.”

Bloomberg last week reported Saudi Arabia’s sovereign wealth fund was set to invest $100 million in AirAsia, with the firm also in discussions with potential investors from Singapore and Japan.

AirAsia was founded in 2001 with two aircraft and has since become one of Asia’s largest budget airline operators. Parent company Capital A was hard hit by pandemic travel restrictions and classified by Malaysia’s stock exchange as PN17, or financially distressed. It is seeking to exit PN17 status to maintain its stock exchange listing.

On Friday, Capital A said Malaysia’s stock exchange had approved its plan to exit PN17 status, which Fernandes said on Monday could be achieved by May. That would allow the company to sell its AirAsia aviation business to long-haul unit AirAsia X, which it announced a year ago in a move to consolidate long and short-haul operations under a single AirAsia brand, according to Reuters.

Before that can be completed, Capital A’s shareholders need to approve the plan to exit PN17 status and Malaysia’s high court has to approve Capital A’s planned capital reduction. Capital A also has to demonstrate two profitable quarters, Fernandes said.

Earlier, Bloomberg News reported that Saudi Arabia’s sovereign wealth fund is in talks to invest US$100 million in Malaysia’s AirAsia, which is owned Capital A.