Loss-making national carrier Malaysia Airlines said today it will sell its landmark headquarters in central Kuala Lumpur for RM130 million (US$36 million) to raise cash.
The 35-storey building located in the heart of the capital will be sold to its parent company, state-owned fund management firm Permodalan Nasional Berhad, the carrier said in a statement.
Malaysia Airlines said the cash proceeds from the sale would help it carry out an ambitious turnaround plan aimed at hauling itself out of the red.
The net book value of the headquarters was RM81.2 million at the end of December 2005, it said.
"Upon completion of the proposed sale, MAS will realise a gain of approximately RM46 million," it said, after accounting for tax and other expenses.
RM50 Mil in 2007?
Malaysia Airlines launched a RM4 billion (US$1.1 billion) turnaround plan in March after it posted a RM1.3 billion annual loss for 2005.
The plan aims to trim losses this year to RM620 million before the company turns a profit of RM50 million in 2007 and then aims for record earnings of RM500 million in 2008.
As part of the revamp, Malaysia Airlines has surrendered all but 19 major domestic routes to budget carrier AirAsia, and will slash its 23,000-strong staff by about 20 percent through a voluntary retrenchment scheme.