AirAsia confirms talks with investors amid SK Group interest

AirAsia Group has confirmed it is studying various proposals for capital injections to strengthen its equity base and improve its liquidity from investment bankers, lenders, and potential investors, shortly after Malaysia’s The Star reported that SK Group was mulling investing around KRW94.2 billion (USD78.6 million) in return for a 10% stake in the Malaysian group. “AirAsia Group Berhad is currently evaluating these proposals and may soon reach a decision as to the final form (which may be a combination thereof) as well as the amount to be raised… The Company is unable to divulge any information at this stage so as not to jeopardise any of the proposals due to the confidential nature of the discussions with the various parties,” the group said in an investor update. AirAsia added that besides talks with potential investors and lenders, it was also in ongoing “deliberations with a number of parties for joint-ventures and collaborations that may result in additional investments in specific segments of the group’s business.” SK Group is South Korea’s third-largest multi-industry conglomerate (chaebol) and has so far not invested in the aviation industry. The group confirmed that it held talks with AirAsia, which would be undertaken through its regional arm SK Southeast Asia Investment Corp., but underlined that a decision about its potential investment had not been taken yet. According to the same report, the Malaysian government is contemplating a MYR1.5 billion ringgit (USD351.5 million) bailout fund for airlines registered in the country, which would be 80% guaranteed by the state.