Malaysia Airlines restructuring talks prolonged, CEO tells staff

© Reuters. FILE PHOTO: Malaysia Airlines planes are seen parked at Kuala Lumpur International Airport, amid the coronavirus disease (COVID-19) outbreak in Sepang

By Anshuman Daga

SINGAPORE (Reuters) – Malaysia Airlines’ parent company is still holding negotiations with lessors and creditors over a restructuring plan to keep the carrier alive, but the talks are taking longer than planned, according to a staff memo seen by Reuters.

“The negotiations are still ongoing and taking longer than the planned timeline, but we are gaining encouraging traction from the lessors and creditors thus far,” Izham Ismail, chief executive of Malaysia Airlines and group CEO of parent Malaysia Aviation Group (MAG), said in a memo to staff on Oct. 16.

In response to a Reuters query, MAG said in an email on Saturday it is “continuing discussions with creditors on its ongoing restructuring exercise”.

MAG, owned by state fund Khazanah, said Izham’s memo to staff was to address concerns among employees.

Malaysia’s national airline is seeking to restructure after the coronavirus pandemic forced it to slash operations.

The carrier had restructured after two deadly crashes in 2014 but unlike at that time the government is unwilling to bail it out this time.

Reuters reported last week that a group of lessors had rejected a restructuring plan that involved steep discounts, bringing the carrier closer to a showdown over its future.

In the memo to staff, Izham assured them that MAG’s restructuring exercise “is still work in progress”.

“Do you see me throwing in the towel yet? Together with the senior leadership team, we are here still fighting for the company’s survival,” Izham said.

On Thursday, MAG said subsidiary Firefly Airlines will start flying in early 2021 as part of a realigned group-wide business strategy.

Reuters reported last week that MAG had warned lessors that its sole shareholder would wind down the airline if restructuring talks are unsuccessful, and would focus on Firefly.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link