Friday, September 14, 2007

AirAsia to buy 20% of FAX for RM26.7mil

AirAsia Bhd has agreed to buy 20% stake in Fly Asian Xpress Sdn Bhd (FAX) for RM26.67mil cash, with an option to acquire an additional 10%.

However, the additional stake would be priced at market valuation and not RM1 par value, AirAsia said in a filing with Bursa Malaysia.

It said the parties signed a definitive agreement on the matter yesteday.

FAX is currently 80% owned by Aero Ventures Sdn Bhd, a company in which AirAsia group chief executive officer Datuk Tony Fernandes and AirAsia deputy CEO Datuk Kamarudin Meranun are substantial shareholders.

AirAsia said it viewed investing in a long haul low-cost airline as beneficial given that the international air traffic to Malaysia was under-served.

It said the investment in FAX was not expected to have any material impact on its financial position in the current financial year.

It would, however, contribute positively to the company's future financial results.

“Budget long haul service is a new business concept in Malaysia that will require some time to nurture to reach its full potential,” it added.

Source : STAR
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