Malaysia Aviation Group (MAG), parent of national carrier Malaysia Airlines, has noted “good progress” in convincing its creditors to accept a restructuring in UK courts under Part 26A of the Companies Act 2006, which potentially allows distressed airlines to restructure leases and hand back aircraft.
MAG noted the "full support by a large majority of creditors for a consensual agreement”, although a “small minority” of creditors are yet to agree.
“MAG is confident that it will achieve a win-win situation with all creditors involved and looks forward to execute its revised long-term business plan alongside its partners,” the flag carrier said.
In October, Airfinance Journal reported that MAG was asking lessors to shave up to 75% off its annual lease bill. If no consensus could be reached the airline might liquidate, MAG told lessors last summer.
According to a letter sent to the leasing community, MAG owner Khazanah Nasional is ready to inject another $1 billion into MAG if the lessors agree to the deal restructurings.
Subsidiary Malaysia Airlines was restructured before, from Malaysia Airlines System (MAS) to its current form, also known as MAB. One option may be to abandon the MAB brand, air operator's certificate (AOC) and all its legacy debts in favour of a fresh start under the air operator's certificate of Firefly, a group subsidiary.
MAB leases 75 aircraft: six Airbus A350-900s, 21 A330-300 and -200 variants, and 48 737-800s.
Air Lease (ALC) has by far the largest exposure to MAB in terms of asset values, listed at $710 million by Fleet Tracker, followed by NBB Leasing, Standard Chartered, Aercap and Goshawk.
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