Malaysia Airlines (MAS) parent Naluri has unveiled a debt restructuring that is due to include the sale of assets over the next two years.
The long-awaited announcement failed to impress shareholders and analysts, however, who say the plan is heavy on promises but lacking in detail.
Under the terms of the restructuring that Naluri says has won approval from creditors, around 1 billion ringgit ($263 million) of debt will be reworked, with obligations to be settled over an extended period of five years. Restructured debts will bear a fixed interest rate of 8.75% annually. Secured creditors will receive cash interest payments of 6% annually while unsecured creditors will receive payments of 2% annually.
New warrants will replace existing ones, while redeemable convertible secured loan stocks will be allocated to creditors "to compensate for cash interest shortfalls".
While asset disposals are promised over two years, no specific mention is being made by Naluri of plans to sell shares in MAS. Rumours have abounded since January that KLM is considering the purchase of a minority stake as part of the Malaysian carrier's expected entry into the "Wings" alliance led by the Dutch airline and Northwest Airlines.
Apart from its 29.09% stake in loss-making MAS, which has a sizeable debt of its own, Naluri has stakes in grounded national carrier Air Maldives, Pelangi Airways, Royal Air Cambodge and World Airways. It is establishing a joint venture aircraft component manufacturing centre in Malaysia with Boeing, Hexcel and local conglomerate SimeDarby.
Days after Naluri tabled its debt restructuring, the company announced the establishment of a new e-business subsidiary, Trifiniti, in partnership with MAS and mobile telecommunications company TRI/Celcom. All are controlled by Naluri chairman Tajudin Ramli.
Trifiniti's main venture will be the establishment of an internet portal focused on the group's "key competencies", namely technology, and travel and tourism. It aims to offer business-to-business and business-to-consumer e-commerce functionalities. It will also manage the information technology infrastructure of Naluri, MAS and TRI/Celcom.
Source: Airline Business
