Govt has received four offers to revive Malaysia Airlines, says Mahathir

Malaysia PM Mahathir Mohamad. Photo: Reuters

The Malaysian government has received four proposals to rescue the ailing Malaysia Airlines, although no decision has been made yet, said Prime Minister Mahathir Mohamad.

Mahathir was quoted by media reports as saying that the proposals are mostly from local entities. He said the government is prepared to listen to all proposals, including offers of a takeover and for collaboration with other airlines. Qatar Airways is said to be the sole foreign company to have sent in a proposal for a takeover of Malaysia Airlines.

Mahathir had laid out two conditions for interested parties to take over the national carrier – to preserve the airlines’ national identity and that the takeover should not result in any retrenchment.

The government, he added, is also willing to give up its majority stake in Malaysia Airlines, though it will ensure that it still “has a say” in the running of the airline.

“The government does not want to be bailing out Malaysia Airlines so many times. But, at the same time, the government wants to have a say. So, we may not have a majority share, but we have to preserve some government role,” said Mahathir, who is also the chairman of Malaysia’s sovereign wealth fund Khazanah Nasional Bhd.

Last week, a group of businessmen led by former AirAsia Group Bhd chairman Pahamin Ab Rajab was said to have expressed interest in helping the Malaysian government turn around Malaysia Airlines. Pahamin was reportedly eyeing a 49 per cent stake in the airline, while the rest will be held by Khazanah, which is currently the sole shareholder of Malaysia Airlines.

AirAsia Group co-founder and CEO Tony Fernandes has said that he is not keen to take over the ailing national carrier and would like to focus on his own company.

Loss-making MAS has repeatedly sought to turn itself around since it was privatised by Khazanah in 2014. It has been at the centre of two aviation tragedies – the disappearance of MH370 and the shooting down of MH17.

Earlier this year, Khazanah demanded that the airline produce a turnaround plan after the fund poured 6 billion ringgit ($1.5 billion) into the company to make it profitable. The fund’s managing director Shahril Ridza Ridzuan said the fund’s investment in the airline remains relevant despite the airline missing its target to break even last year, causing Khazanah a 7.3 billion ringgit ($1.78 billion) impairment loss.