AirAsia X shows judicial creditors’ support for restructuring plan By Reuters

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By Liz Lee KUALA LUMPUR (Reuters) – Most of AirAsia X Bhd (AAX) lessors support a restructuring plan, and the Malaysian airline has received interest from potential investors to raise funds after the reorganization, filed court documents show this month. In the emails attached to the court documents, the supporting lessors said they wanted to continue talks with the low-cost carrier and potential new investors, seeking more equitable terms and new business deals. The affidavits come after more than a dozen creditors came forward to intervene in its court-supervised restructuring proposal, with lessor BOC Aviation Ltd and airport operator Malaysia Airports Holdings Bhd arguing that AAX is “hopelessly insolvent. “. Aircraft maker Airbus SE (OTC 🙂 also filed a lawsuit last month saying it could lose more than $ 5 billion in aircraft orders if the low-cost, long-haul carrier proceeded with the plan. AAX Senior Counsel Shereen Ee said in court documents seen by Reuters that 15 of the 20 aircraft lessors were not in favor of the AAX liquidation, and three other interveners: Airbus, Rolls-Royce (OTC 🙂 Group and BNP Paribas (OTC). 🙂 – “did not oppose” the restructuring plan. Lessors in favor of a restructuring include Macquarie Aircraft Leasing Services and Aircastle, according to the documents. Rolls-Royce, Macquarie Aircraft Leasing Services and Aircastle did not immediately respond to requests for comment. An Airbus spokesman declined to comment, saying the company was continuing discussions but details are confidential. AirAsia X also declined to comment. BNP Paribas, which is a trustee acting on the instructions of a creditor, declined to comment. Aircastle Asia Pacific Executive Vice President Nigel Harwood told AAX in an email that his firm did not seek liquidation of the airline, according to court documents. “We look forward to working with you to reach a revised business agreement once we understand your future business plan with the introduction of new investors,” he said. Macquarie’s email said she was willing to back a recapitalized AAX and enter into a restructured lease on the condition that the airline has a detailed business plan, credible third-party investors and that lessors have a meaningful voice, according to the documents. . AAX said it had received 10 letters from Malaysian and Singaporean corporations and wealthy individuals indicating interest in participating in its proposed fundraising exercise, according to an affidavit. The 10th includes Tune Group Sdn Bhd, owned by AirAsia Group Bhd co-founders Tony Fernandes and Kamarudin Meranun. Tune is the largest shareholder in AAX, with a 17.83% stake. AAX said it also received the interest from a publicly traded financial group and another’s subsidiary, with both declining to be identified. AAX, an affiliate of AirAsia Group, said last month that it planned to raise up to 200 million ringgit ($ 49.49 million) by issuing shares to new investors after restructuring its debt. The airline seeks to restructure ringgit 64.15 billion of debt. Its cumulative debt amounts to RM2.24 billion, excluding contingent debts such as its large aircraft order book with Airbus. Some lessors have argued that Airbus orders should be excluded. However, AAX said contingent debts must be addressed and will be reduced by renegotiated leases and other commercial contracts. AAX estimated that lessors who continue with the airline after the restructuring could recoup approximately 44% to 66% of the lease loss under new agreements. ($ 1 = 4.0410 ringgit)