Monday, July 13

MAS, AirAsia sign CCF for better collaboration

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PARTNERSHIP SEALED: (From left) Khazanah Nasional Bhd’s (Khazanah) managing director Tan Sri Azman Mokhtar, Malaysian Airline System Bhd’s (MAS) chairman Tan Sri Md Nor Yusof and AirAsia Bhd’s group chief executive offi cer Tan Sri Tony Fernandes share a light moment during a signing ceremony in Kuala Lumpur. The nation’s fl agship carrier MAS and AirAsia have agreed to set aside their rivalry and work together after signing a share swap agreement yesterday. Based on the terms of the agreement, AirAsia’s major shareholder Tune Air Sdn Bhd, controlled by its two principal founders Fernandes and Datuk Kamarudin Meranun, would buy a 20.5 per cent stake in MAS from MAS’ major shareholder Khazanah. — Reuters photo

KUCHING: Malaysian Airline System Bhd (MAS), AirAsia Bhd (AirAsia) and its long-haul low-cost unit AirAsia X Sdn Bhd (AirAsia X) yesterday entered into a Comprehensive Collaboration Framework (CCF) that would include a collaboration agreement to explore opportunities on a broad range of areas.

Under the CCF, all parties would strive to complement each other’s businesses so as to leverage on respective core competencies and optimise efficiency for the benefit of consumers.

To strengthen the collaboration and establish a mutuality of interest, MAS and AirAsia would be issuing free warrants to each other’s shareholders where independent advisers would be appointed to advise minority shareholders on the proposed warrants.

“A MAS shareholder will be granted approximately one warrant in AirAsia for every 30 MAS shares held. An AirAsia shareholder will be granted approximately one MAS warrant for every 10 AirAsia shares held,” a joint statement from MAS, AirAsia and Khazanah said yesterday.

“In addition, Tune Air Sdn Bhd (Tune Air) and Khazanah Nasional Bhd (Khazanah), the major shareholders of AirAsia and MAS, respectively, have agreed to acquire from each other existing shares of both companies.

“As a result, Tune will hold 20.5 per cent of shares in MAS and Khazanah will hold 10 per cent of shares in AirAsia,” it added, pointing out that Khazanah would continue to be the single largest and major shareholder of MAS.

“In addition, Khazanah proposes to acquire 10 per cent of shares in AirAsia X on terms and at a price to be mutually agreed later.”

Notably, the agreement would also envisage more detailed terms of collaboration following completion of a full anti-trust review by all three companies.

“The collaboration agreement will come into effect immediately upon its execution, and shall remain in effect for a period of five years from the date of the areement with an option for a further five-year renewal,” it added.

An advisory panel, chaired by former Prime Minister Tun Abdullah Ahmad Badawi, had also been set up to ensure that all parties involved in the CCF, would operate in the interests of the public and reflects the aspirations of all consumers.