Malaysia Airlines to Cut 6,000 Jobs, de-list in $1.9 Billion Restructuring
Tip: Highlight text to annotate itX
Malaysia Airlines (MASM.KL), the country's loss-making flag carrier, will cut 30 percent of its workforce as part of a sweeping restructuring that will cost 6 billion ringgit ($1.90 billion), majority investor Khazanah Nasional [KHAZA.UL] said.
The carrier will slash its staff by 6,000 to 14,000 as it takes steps to stem long-running losses worsened by two aircraft disasters this year, the state fund said in a statement on Friday.
Malaysia Airlines will be de-listed from the Kuala Lumpur exchange by the end of 2014, Khazanah said, adding that it aims to return the carrier to profitability within three years of the de-listing.
"Recent tragic events and ongoing difficulties at MAS have created a perfect storm that is allowing this restructuring to take place," Khazanah Managing Director Azman Mokhtar told reporters in Kuala Lumpur.
"We believe that the 6 billion is not a bailout, we believe it will be recovered with re-listing," he said.
Khazanah said in the statement that it plans to re-list the carrier in three to five years from now.
Ahmad Jauhari Yahya will stay on as chief executive until July next year, Khazanah said, adding that the search for a new CEO has begun.
STEMMING LOSSES
On Thursday, MAS said its second-quarter net loss widened to 307 million ringgit from 176 million a year earlier, though the result was an improvement from a net loss of 443 million ringgit in the first quarter.
MAS warned of poor second-half earnings as passenger bookings continue to fall, with business hit by the shooting down of Flight MH17 over Ukraine in July and the unexplained disappearance of Flight MH370 in March.
MAS has posted three straight years of losses in the face of competition from rising budget airlines like AirAsia Bhd (AIRA.KL).
Khazanah, which currently has a 69 percent stake in the carrier, has injected more than 5 billion ringgit into MAS over the last 10 years.
Khazanah said it plans to reduce the net gearing of the airline through debt-for-equity swaps.
It will also review all supply contracts while focusing on the carrier's regional flight network and improving revenue yields.
Malaysia Airlines will retain global flight connectivity through the Oneworld alliance and code-sharing, Khazanah said.
David
annotated1+ month ago
Encik Ahmad Jauhari bin Yahya - Chief Executive Officer, Managing Director, Non-Independent Executive Director, Member of Board Tender Committee and Member of Board Safety & Security Committee, Malaysian Airline System Bhd
Ahmad bin Yahya : Executive Profile & Biography - Businessweek
Mr. Encik Ahmad Jauhari bin Yahya has been the Managing Director at Malaysian Airline System Bhd since September 19, 2011 and serves as its Chief Executive Officer. Encik bin Yahya serves as Project Director of First Island at Lumut Maritime Terminal Sdn. Bhd. He serves as Managing Director at Tekni
investing.businessweek.com
David
annotated1+ month ago
Tan Sri Dato. bin Hj. Mokhtar, Managing Director at Khazanah Nasional Berhad
David
annotated1+ month ago
On July 17, 2014 Malaysia Airlines Flight MH17 was shot down near the Ukraine-Russia border with 298 people aboard and On March 8, 2014, Malaysia Airlines Flight MH370 lost contact en route to Beijing with 239 people on board and still can't the plane.