By ZAIDI ISHAM ISMAIL
[email protected]
KUALA LUMPUR Nov 12 - ALL eyes will be on the meeting today between AirAsia X and its creditors.
This is to resolve the long haul carrier's debt reportedly said to total RM33.6 billion.
AAX is a Practice Note 17 company or PN17, a classification by Bursa Malaysia for financially distressed companies which came as a no surprise given the challenging aviation business landscape.
"It will be an interesting meeting as the debts are massive and it won't be easy for the creditors to write it off.
"I suspect AAX will fight tooth and nail to get a time extension on the debts or get a portion of it written off," a fund manager told DagangNews.com.
It is reported that the low cost long haul carrier is expected to hold separate meetings for the three classes of creditors.
This comprise creditors that have securities over the assets of AAX, including airport operator Malaysia Airports Holdings Bhd and financial institutions (class A).
Another class of creditors are those which have unsecured claims against AAX, including engine suppliers and aircraft lessors (class B), and aircraft manufacturer Airbus (class C).
The proposed debt restructuring requires the approval of at least 75 percent of the total debt value in each class of creditors.
Failure to get creditors’ approval for its business restructuring will likely see the carrier becoming insolvent and result in material losses to its stakeholders.
AAX has 12 months to regularise its financial condition, failing which it will be delisted from Bursa Malaysia.
On top of this, AAX also has to contend with the wrath of its customers who are baying for their money back.
Under its proposal last month, AAX proposed to refund 0.05 percent of each customers ticket purchase.
What this means is that, an air traveller who bought a ticket worth RM2,000 will only get back RM50.
Whichever way, investors like this unfolding development which saw AAX shares on the rise since Monday and was among the most actively traded.
The hopes and expectations of AAX air travellers and shareholders hinge very much on this meeting and they expect nothing less but their money back. - DagangNews.com
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