British businessman Richard Branson's Virgin Group will take a 20 percent stake in Malaysia's AirAsia long-haul budget carrier, it was announced today.

"Sir Richard Branson of Virgin Group is our new strategic global investment partner," said Kalimullah Hassan of Fly Asian Xpress Sdn Bhd (FAX), the long haul operator of AirAsia X, and tipped to begin services next month.

"We believe that this partnership whereby Virgin will take a 20 percent stake in AirAsia X will be a sound and successful investment," Kalimullah said.

Branson, the founder of Virgin Group, attended the announcement in the administrative capital of Putrajaya south of Kuala Lumpur wearing a traditional Malay outfit and headgear.

"I am thrilled to be able to support them in this venture and look forward to seeing low cost, long-haul travel being opened up from their base in Malaysia," Branson said.

He said AirAsia chief executive Tony Fernandes has had "phenomenal success" in the short-haul Asian route and "we believe they will have the same success with AirAsia on the long-haul."

Analysts describe Branson's move as a major coup for Fernandes, founder and director of FAX who holds 50 percent in the firm.

Fernandes, founder and director of FAX holds 50 percent in the firm and his deputy owns Kamarudin Meranum 30 percent.

FAX has 15 widebody A330-300 airliners on order from Airbus, the European manufacturer.

Budget flight to Britain

Meanwhile, The Edge financial daily cited sources in a report that AirAsia X had already secured rights to fly to Australia and Stansted in London.

AirAsia X is scheduled to begin long-haul flights to China and Australia on Sept 8, using three leased planes, from the low-cost carrier terminal at Kuala Lumpur International Airport (KLIA), company officials earlier said.

At its launch in January, the carrier had promised budget flights to Britain beginning in July.

Fernandes launched AirAsia as a pioneering regional budget carrier in December, 2001, with two aircraft. It now serves domestic and international routes throughout the region.

AirAsia shares traded lower, lost 0.05 to 1.94 (0.59 dollars) in early trade.