Budget airline AirAsia X out of money, needs $120 million for restart

AirAsia needs to convince its lessors of its business plan, with an unnamed lessor recently taking back one of the airline’s planes to convert it to a freighter. (AFP)
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Updated 17 October 2020

Budget airline AirAsia X out of money, needs $120 million for restart

  • ‘Obviously, banks will not finance the company without shareholders, both old and new, putting in fresh equity’

Long-haul, low-cost carrier AirAsia X has run out of money and needs to raise up to $120.6 million to restart the airline, deputy chairman Lim Kian Onn said in a newspaper interview published on Saturday.
The Malaysian airline, the long-haul arm of AirAsia Group Bhd, said this month it wanted to restructure $15.32 billion of debt and slash its share capital by 90 percent to continue as a going concern.
“We have run out of money,” Lim told The Star newspaper. “Obviously, banks will not finance the company without shareholders, both old and new, putting in fresh equity. So, a prerequisite is fresh equity.”
He said the airline had actual liabilities of $482 billion, with the larger figure of $15.32 billion including all lease payments for the next eight to 10 years and its large order for Airbus planes and contracted engine maintenance with Rolls-Royce Holdings.
“If we find RM300 million in new equity, then the shareholder funds are RM300 million at the restart of business and if we are able to borrow RM200 million, we feel that we will have a good platform to start all over again,” he told The Star.
Lim said AirAsia X also needed to convince its lessors of its business plan, adding an unnamed lessor recently took back one of the airline’s planes to convert it to a freighter.
The airline plans to liquidate its small Indonesia-based carrier and has completely written down its stake in Thai AirAsia X in its books, with the Thai carrier not part of the restructuring scheme, Lim told the newspaper.
Rival Malaysia Airlines is also in financial trouble, but Lim said there would be “no good outcome” from seeking to merge two airlines in dire straits.
AirAsia X declined to comment beyond the details published in the newspaper article.


50% of workers fear losing job in next 12 months: Global economic survey

Updated 23 min 38 sec ago

50% of workers fear losing job in next 12 months: Global economic survey

  • Saudi adults more optimistic of developing new skills for future jobs
  • 195m jobs lost worldwide amid COVID-19 pandemic: Egyptian minister

DUBAI: More than half the global workforce fears being made redundant in the next 12 months, according to a World Economic Forum-Ipsos survey.

The study, released on the eve of the World Economic Forum’s (WEF) Jobs Reset Summit, questioned 12,000 adults in 27 countries about employment prospects during the ongoing coronavirus disease (COVID-19) pandemic.

And although at least 50 percent were concerned about losing their jobs over the coming year, two-thirds of workers worldwide said they could learn the skills needed for the jobs of the future through their current employer.

In Saudi Arabia, less than 20 percent of those who took part in the survey were very concerned about their jobs disappearing, compared to 39 percent in Spain.

While the findings painted an overall gloomy picture of the global job situation amid the COVID-19 outbreak, they also highlighted green shoots of optimism, particularly in the Kingdom.

Around 18 percent of Saudi workers were not at all worried about losing their jobs, more than the global average of 17 percent.

On learning, Saudis were even more enthusiastic, with 39 percent confident of gaining the necessary skills to compete for the new job opportunities of the future.

During a WEF discussion on the impact of the global health crisis on employment, Rania Al-Mashat, the Egyptian minister for international cooperation, described the COVID-19 pandemic as a mix of many crises that had rendered 195 million people jobless around the world.

But she said that Egypt’s young population offered great opportunities for the country and the government had already rolled out plans to tap into youth development before the virus outbreak.

“The Egyptian government has taken comprehensive measures to reshape the education system incorporating a significant technology element to the sector and this turned out to be very useful for home schooling during the lockdown,” the minister added during a session titled, “Building a New Economy and Society.”

Al-Mashat pointed out that Egypt was adopting the principles of stakeholder capitalism, and in order to utilize the energies of its youth had been actively creating entrepreneurial space and building a strong digital infrastructure. She said there had been many policy movements, especially in the creation of gender equality accelerators.

Alan Jope, the CEO of Unilever and a speaker in the same session, said COVID-19 was not the only current world crisis, adding that economic, health, geopolitical, trade wars, climate change, capital wars, and a few looming military conflicts could be added to a global list of crises.

He also noted that gross domestic product (GDP) should not be considered the only economic measure. “Our measures for success need to change, we’ll have to look at social and environmental parameters, and not just the GDP.”

Jope predicted plenty of future jobs but not in traditional areas of work. “Most of the jobs will be created in the low-carbon sector, along with the IT and biotech industries,” he said.