Southeast Asia's largest low cost carrier AirAsia will launch a new budget airline in Vietnam, officials said Friday, and hinted at more joint ventures in the region.

Chief Executive Tony Fernandes also told AFP that the Malaysian company will order 25 new A320 Airbus aircraft to cope with the increasing passengers and routes.

AirAsia, which on Thursday posted a 41.5 percent rise in fourth quarter profits, will team up with the state-owned Vietnam Shipbuilding Industry Corporation (Vinashin) to form Vina AirAsia in a 30-million-dollar deal.

"We have signed a Memorandum of Understanding with Vinashin today (Friday) to form Vina AirAsia," Fernandes said.

"Vietnam, with a pro-business leadership and a 84-million population, is a fertile place for AirAsia to expand its business. We are seeing a tourism boom and we want to be part of it," he added.

A contract will be formally signed on September 20, Fernandes told AFP, and Vina AirAsia planned to begin flying in July 2008, with possible routes to southern China from its hub in Hanoi.

Pham Thanh Binh, chairman and chief executive officer of Vinashin, told AFP that the company was excited to be forming a partnership with AirAsia.

"We will be the first budget carrier in Vietnam," he said.

Vinashin's business activities include ship building, finance, property development and banking.

It will be entering the aviation industry for the first time, holding a majority stake in the venture, which will have an initial share capital of 30 million dollars.

"Aside from Vietnam, we are also planning two more joint ventures in the region," Fernandes said earlier in the New Straits Times newspaper, but gave no further details.

'In for the long haul'

AirAsia's has similar partnership agreements with Thailand and Indonesia - alliances which Fernandes said have yet to bring in profits.

"But we are very positive. We are in for the long haul," he told AFP.

AirAsia, which was established six years ago, will also formally announce within two weeks the purchase of 25 new Airbus A320s as part of its fleet expansion programme amid rapid growth in passengers and new routes.

Officials estimate the purchase cost to be around 1.6 billion dollars based on the list price of the model.

AirAsia is the single largest buyer of the A320-200 in the Asia Pacific region, with plans for the aircraft to completely replace its current fleet of 28 single-aisle, 148-seat Boeing 737-300s.

The group, which announced new routes from Thailand and Malaysia to Hong Kong last week, has reported net profit in the fourth quarter at RM185.05 million (US$53 million dollars) after a 45 percent increase in passengers.