Kuala Lumpur: Khazanah Nasional Bhd will submit a new business plan to revive the Malaysia Airlines (MAS) in the period between six to 12 months.
Khazanah managing director, Tan Sri Azman Mokhtar, said the investment arm of the government was looking at all the available options to restructure the national airlines that are facing the problem.
"All options are being observed and the study is still ongoing," he said at a news conference at the annual conference of the Invest Malaysia 2014 yesterday.
Azman said, MAS has sufficient capital to continue with its operations for the year ahead, but some long-term options are being evaluated for it to continue operating beyond that period.
"In the near term of 12 months, MAS has enough capital to continue operating. The options are either to sell, file bankruptcy, or injecting more funds all continue to be studied.
"At this point of time and is still too early to say what options will be used.
"I think the final decision will be made by the government and our job is to advise on what to do," he said.
Khazanah now controls 69.4 per cent of MAS.
Airline’s effort to recover from the losses for three consecutive years was compounded by tragedy MH370 aircraft lost in March.
In the first quarter of this year, MAS reported to bear a larger loss of RM443 million compared to the same period last year, with ticket sales after the tragedy MH370 affected.
MH370 Tragedy give effect.
The losses of MH370 aircraft carrying 153 Chinese from the 239 passengers on March 8 impact on the business market MAS in China republic.
It loses up to 60 percent of sales in China since the tragedy.
Azman said three things need to be assessed by the Khazanah in any restructuring of government-linked companies (GLCs), including MAS.
He said three things are internal work culture and productivity of MAS, external support from the government and the third is the leadership and management of the airline to implement the restructuring.
"This is a serious issue, an issue which we have to balance between Khazanah an important national institution to manage taxpayers' money," he said.
Asked whether the funds amounting to RM5 billion injected into the MAS by the Khazanah 10 years ago are used effectively, Azman said, in term of the financial aspect, it is fails because MAS continues to record losses.
"But (it helps) in the aspects of economic and country development, connecting people and commercial activities," he said.
MAS shares fell as much as 28 percent since the tragedy MH370, with the confidence of investors affected by the decline in traffic MAS and uncertainties about how the Khazanah and the government’s plan to save the company.
MAS should be broken.
Its market value plummeted 85 percent in the last five years to RM3 billion currently.
Meanwhile, Maybank Investment Bank Bhd aviation analysts, Mohshin Aziz, said Khazanah Nasional must provide recovery plan as soon as possible or face the possibility of worse situations.
"We think MAS should be broken into smaller entities such as the branch of engineering, Firefly, terminal services and the parent airline. It is unlikely to survive in its current form, "he said in Kuala Lumpur yesterday.
Another analyst said MAS should be able to hold up until Khazanah Nasional provides the solutions to restructure the national airlines.
"Planning is one thing and restore the airline is another story," he said.
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