Malaysia’s Asia Cargo Express sold to fund cargo facilities

Network courier Pos Malaysia’s sale of a 51% stake in Asia Cargo Express (3G, Kuala Lumpur Int’l) to Asia Cargo Network (ACN), announced last month, will allow the parcel service firm to invest in fully-automated cargo fulfilment centres across the country while leveraging ACN’s experience in air freight, Pos Malaysia group CEO Syed Md Najib Syed Md Noor has told The Edge Malaysia Weekly. Asia Cargo Network already leases its single B737-400(F), 9M-POS (msn 25099), to Asia Cargo Express, the ch-aviation fleets advanced module shows. Pos Malaysia announced on August 19 that it had entered into a share subscription agreement and a shareholders’ agreement to dispose of the 51% stake, selling it for MYR40 million ringgit (USD9.6 million). On completion of the deal, Pos Malaysia unit Pos Aviation will retain a 49% stake in Asia Cargo Express, which will then be renamed World Cargo Airlines (3G, Kuala Lumpur Int’l). Najib said at the time of the announcement that the sale of the non-core business would allow it to enhance its services, as “through the partnership, we aim to leverage ACN’s experience and expertise to provide more value to our customers by offering enhanced air cargo connectivity, efficiency, and speed.” He added: “The regional network of ACN will provide synergistic opportunities for Pos Malaysia as Kuala Lumpur Int’l is being developed as a regional e-fulfilment cargo hub. This will also allow Pos Malaysia to focus on meeting customer expectations in our core business, consisting of postal, courier, and retail services.” Najib elaborated to The Edge Malaysia that its aviation business had been loss-making for Pos Malaysia, notching up an after-tax loss of about MYR32 million (USD7.7 million) in the nine months ending December 31, 2019. The divestment comes with a service-level agreement allowing World Cargo Airlines to continue serving Pos Malaysia’s air cargo needs between the Malay peninsula and the Malaysian states of Sabah and Sarawak, he said. The network courier also divested, in February, a 49% stake in Pos Aviation Engineering Services to Singapore Airlines (SQ, Singapore Changi) unit SIA Engineering for cash consideration of MYR10.09 million (USD2.4 million). There will be at least one more divestment next year, Najib confirmed.