Proponents of the share swap between flag carrier Malaysian Airlines (MAS) and no-frills airline AirAsia defended the deal, stating that it is of “more advantage” to the former.

Officials from the government, Khazanah Nasional Bhd and MAS had apparently told the Public Accounts Committee (PAC) in Parliament today that the swap and the subsequent comprehensive collaborative framework (CCF) would benefit the parties, following changes in the international aviation arena.

NONE “In fact now, MAS is losing a lot of money. So they saying (the move is necessary) to try and overcome this problem... of course in some situation, you don’t need a share swap to have the CCF but they find that it will facilitate things,” PAC member Tan Seng Giaw ( left ) told reporters.

Tan, who is also the Kepong MP, however said that today’s meeting was just a preliminary session and more will be unveiled in the next two to three weeks.

PAC today interviewed MAS managing director Ahmad Jauhari Yahya, Khazanah chief executive officer Azman Mokhtar, and the secretaries-general of the Finance Ministry, Treasury and the Transport Ministry.

The revelations by the officials today are part of the PAC string of investigations on various queries raised by MPs during their speeches in the Dewan Rakyat.

According to past news reports, the deal between AirAsia and ailing MAS was aimed at saving the national flag carrier, by allowing the airlines to combine flight frequencies and destinations as well as increase their bargaining power with airports and aircraft makers.

However, Khazanah, the government’s investment arm, which owns about 70 percent of the flag carrier, said it would maintain its position as the single largest shareholder in MAS.

‘MAS is in bad shape’

PAC chairperson Azmi Khalid, at a press conference, said that the officials were present today on the orders from the relevant ministries.

He also refrained from explaining the details of what had transpired during the meeting, simply saying that: “I cannot say in detail because we have yet to make any conclusion... we are just getting information about why and how. So for the time being, we have no comments.

NONE “Yes, we are considering (speaking to AirAsia). Time was so short today. Two hours is not enough. We could not ask many questions today,” Azmi ( right ) said when quizzed on whether the budget carrier will also be called in.

Petaling Jaya Utara MP Tony Pua, who also sits on the committee, however shed some light into the proceedings today.

“Khazanah defended the deal on a commercial basis. MAS is in bad shape and some form of collaboration is required to alleviate the problems MAS is facing.

“They put forward the case that the value of the transaction is fairer to Khazanah and the government by comparing its price earning ratio (PE) and net tangible assets (NTA),” he said.

BN Kota Belud MP Abdul Rahman Dahlan added that the interview today was more of a “one-way traffic” as the committee just listened to the officials’ explanations.

“I came into this meeting not wanting to be vindictive. I want to know more. Because obviously the issues are big and MAS is losing money and it is our pride... why they did what they did. And their take on the airline industry.

“So, really, we have not given them any curve ball yet, we haven’t asked any tough questions in that regards. No time yet for that,” he said.