AirAsia X gets shareholder go-ahead for restructuring plan

Kuala Lumpur

AIRASIA X shareholders have approved the Malaysian budget airline's debt restructuring, it said on Tuesday, enabling it to pursue a scheme it viewed as key to its survival.

Shareholders of the long-haul affiliate of the AirAsia Group approved all resolutions at an extraordinary general meeting, including a rights issue and a share subscription for new investors to raise RM500 million (S$161.7 million).

Last October, AirAsia X proposed to restructure its RM64.15 billion debt into a principal amount of RM200 million and have the rest waived.

The airline said in a separate statement that the resolutions were passed with at least a 99.8 per cent margin, and marked a major milestone in progress on its restructuring.

"These approvals have been obtained simultaneously with final negotiations being held with creditors," it said, adding that with advisers New York-based Seabury Capital, it had been "in active and productive" talks with lessors and others.

A Malaysian court in February granted the airline leave to convene separate meetings with its different groups of creditors within six months, to vote on its scheme.

The meeting is scheduled for late July or August, AirAsia X said.

In March, the court also granted AirAsia X a three-month order against any proceedings that may be filed against it, which could have slowed down its restructuring.

Plane-maker Airbus last year joined more than a dozen creditors to challenge the debt restructuring plan, telling the court it stands to lose more than US$5 billion in orders if the proposal goes through.

Other challengers include lessor BOC Aviation (BOCA), which called for a debt-to-equity swap.

Airbus said it cannot comment on the airline's ongoing restructuring plan; BOCA said it does not comment on individual customers.

In February, AirAsia X proposed a separate restructuring programme for its aircraft lessors, which aims to address their concerns about forward commercial agreements and the viability of the airline's business after recapitalisation. REUTERS