AirAsia to raise RM1b by selling shares to founders
Malaysian budget airline AirAsia Bhd has agreed to raise RM1 billion (US$257 million) through a share sale to its founders as part of a strategy to cut debt, one day after Reuters reported the company planned to raise funds.
Asia's biggest budget airline proposed to issue 559 million new shares to group chief executive Tony Fernandes and chairperson Kamaruddin Meranun, which will boost their combined stake to 32.4 percent from 18.9 percent, it said in a statement today.
The airline said the proposed issue indicates the continued commitment of Fernandes and Kamaruddin as they make further large investments into the group to support its growth.
The move comes after AirAsia faced urgings last year to shore up its financing in tough operating conditions. However, a decline in fuel costs and the recent strengthening of the ringgit has however improved the airline's prospects.
CIMB Investment Bank and RHB Investment Bank are joint principal advisers for the proposed share issue.
- Reuters
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