KUALA LUMPUR: Asia’s largest low-cost carrier (LCC), AirAsia Group plans to create an Asean airline, which will act as a holding company that will fully own all of its entities which include AirAsia Bhd, Thai AirAsia and the soon-to-be-listed Indonesia AirAsia and Philippines AirAsia.
The airline’s group chief executive officer, Tan Sri Tony Fernandes told Business Times that AirAsia’s affiliates in Indonesia and Philippines have appointed bankers in both countries respectively to work on the planned initial public offering (IPO).
Once all the four Asean-based airlines are listed, AirAsia then plans to create a holding company, which will then have a 100 per cent stake in all the listed airline companies.
Currently, AirAsia Bhd, which is AirAsia’s Malaysia affiliate, owns a 49 per cent stake of the airlines’ international venture while the remaining 51 per cent are owned by foreign shareholders in the respective countries.
The objective of the move, said Fernandes, is to have one company in the end. The move would be similar to European group airlines such as the International Consolidated Airlines Group, S. A. (IAG) and Air France-KLM.
Indonesia AirAsia and Philippines AirAsia have a promising future based on its third quarter 2016 operating statistics.
AirAsia’s Indonesia affiliate achieved a record load factor of 90 per cent in the third quarter this year compared to the same period last year. Its passenger numbers were two per cent higher at 1.71 million from 1.67 million in the same period a year ago.
AirAsia Philippines’ passenger numbers rose by eight per cent to 976,765 from 901, 957 a year ago although its load factor decreased to 83 per cent. However, Fernandes remains thrilled by the performance of the airlines and he is confident that the fourth quarter results will be much better.
AirAsia Indonesia and AirAsia Philippines are expected to be listed by the first quarter of 2017.
“We are now pushing ahead with the much anticipated IPO in those respective countries. Both countries are going to have very strong growth over the next three years. And we are excited by these developments. It has vindicated our strategy of taking a long-term approach,” Fernandes told Business Times in an exclusive interview yesterday.
SINGLE ASEAN BOURSE IN THE FUTURE?
Currently, AirAsia have two strong associates in Malaysia and Thailand, and Indonesia and Philippines is expected to catch up quickly with both countries.
“This completes our Asean strategy and also will show that we are not a one trick pony…My ultimate aim is to create an Asean-owned airline and to that extent, once we have listed all of these entities, it is to create an Asean holding company which will hold 100 per cent of all these airlines.”
“We have had initial discussions with regulators and while there is a lot of work to be done, there is tremendous enthusiasm to create Aasean brands and Asean stocks,” Fernandes said, adding that the creation of an Asean asset class would one day lead to an Asean stock exchange.
He said 2017 will also be an exciting year for AirAsia as there would be a lot of ancillary opportunities with profitable capacity being added, decreasing costs and a resurgent AirAsia X Bhd which would add value to AirAsia.