Budget airline AirAsia’s Chief Executive Officer has reportedly indicated that budget flights from Kuala Lumpur to Britain could take off from March next year, priced at between Ł130 and Ł200 for a return trip. (5/8/2007)
AirAsia is planning to sell a significant stake in its new long-haul business to private equity investors as the airline prepares to fly to Britain. According to The Guardian, despite scepticism about its business model, AirAsia’s long-haul spin-off has received overtures from private equity groups.
“We have enough capital to last us but if there is cash available we should take it,” said Mr Fernandes, who added that a lot of people from the private equity community have made approaches for 20-30 percent of the business.
The media report added: “The AirAsia boss declined to name the suitors, but the company has appointed investment bank Credit Suisse to broker the deal. Buyout firms from the US and the UK have expressed an interest but it is understood that TPG, which is bidding for Spain’s national carrier, Iberia, has withdrawn from the process after its offer to buy the venture outright was rejected.”
As per the information available, having leased a single 380-seat Airbus A330-300 aircraft, AirAsia will launch its inaugural long-haul service from its Kuala Lumpur base in September, with Australia or China the likely destination.
“UK flights are scheduled to start in March or April once the company has leased a second aircraft. London Stansted - "the low-cost capital" according to AirAsia - is expected to win a contest with Manchester airport to be the UK destination. The return flights will cost between Ł130 and Ł200, with food and in-flight entertainment costing extra. With about 380 seats, AirAsia expects to break even if the plane is 56 percent full, said Mr Fernandes. The venture is backed by an initial investment of $30m (Ł15m) from Mr Fernandes and fellow AirAsia investors,” as per the same media report.
AirAsia plans Ł130 return to Malaysia: media