Malaysia's AirAsia secures loan, capital raising progressing, says executive

[KUALA LUMPUR] Malaysia's budget carrier AirAsia Group has secured a loan as part of its ongoing capital raising plans, an executive said on Thursday.

Riad Asmat, chief executive of the group's Malaysian unit, AirAsia Bhd, said "a loan has been approved and disbursed", in response to a Reuters query about a report from New Straits Times that said the airline had secured a RM300 million (S$98 million) loan to keep it afloat amid the coronavirus pandemic.

The report, citing sources, said the airline took the loan from Sabah Development Bank and that it would tide the airline over for two months, financing local operations.

"We would not be able to disclose the specifics including the lender(s) and amount involved. This loan is part of the capital raising exercise by AirAsia Group, which is moving in the right direction and we are pleased with the progress," Mr Riad said.

Sabah Development Bank could not immediately be reached for comment.

AirAsia has said it is looking to raise as much as RM2.5 billion by year-end, RM1.5 billion of which could be in bank loans.

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The group has also been seeking a portion of its loans to be guaranteed by the government.

Two weeks ago, its long haul arm AirAsia X Bhd proposed at a US$15.3 billion debt restructuring and cutting share capital to avoid liquidation.

REUTERS