AirAsia gets shareholder nod to sell plane portfolio to Castlelake

An AirAsia baggage handler drops a bag on the tarmac at Kuala Lumpur International Airport in Sepang, Malaysia, June 17, 2015. REUTERS/Olivia Harris

Malaysia-based low-cost carrier AirAsia Group Bhd has received shareholders’ approval for the disposal of 25 aircraft to US private investment firm Castlelake for $768 million, according to its CEO Tony Fernandes.

“Selling our aircraft monetises all our aircraft at high prices and avoids residual risk and allows us to return cash to shareholders and invest in our new digital business,” Fernandes said in a tweet after an extraordinary general meeting with AirAsia’s shareholders on Wednesday.

Last December, AirAsia had said it will sell a portfolio of 25 planes to Castlelake and the latter will also purchase four new aircraft that will be delivered to AirAsia this year. The 29 planes – Airbus’ A320-200ceo and A320neo – will be leased back to AirAsia.

AirAsia has been on a quest to actively expand its digital businesses in order to become an asset-light company. Last month, it launched a $60-million global venture fund in partnership with Silicon Valley venture capital firm 500 Startups.

Called RedBeat Capital, the fund will target post-seed stage startups seeking to enter or expand their presence in Southeast Asia. Its deputy group CEO Aireen Omar had told DEALSTREETASIA that AirAsia will anchor the fund, with participation from external investors. The fund will focus on investments in the travel and lifestyle sectors.

Fernandes had also said AirAsia is looking to spin off its website to monetise the budget airline’s tech asset.

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