BACK TO PROFITABILITY: Jentayu Danaraksa says it can revive MAS for less than RM6b
JENTAYU Danaraksa Sdn Bhd, which proposed an “alternative plan” for loss-making Malaysian Airlines (MAS) recently, said it can revive the carrier for less than RM6 billion and make it profitable in a few years.
Its director Shukor Yusof said the final investment cost would depend on how (if at all) the company’s proposal was viewed and if it was accepted by the government.
“We plan to rehabilitate MAS and wean it from further using taxpayers’ money. The airline business is capital intensive and MAS must be focused on building its cash reserves, which means to avoid borrowings until its cash flow stabilises.
“As with any major restructuring, especially with a company saddled with RM12 billion debts and yearly finance charges amounting to over RM400 million, the investment structure will be immensely complex.
“We will share it with the public if we get a chance to work with Khazanah Nasional Bhd. We are confident it will cost us much less than RM6 billion to save MAS,” he said.
The newly set-up financial advisory firm submitted an alternative proposal, which it said would complement Khazanah’s 12-point plan, to Prime Minister Datuk Seri Najib Razak on November 3.
Khazanah has received minority shareholders’ approval to take MAS private, and this will kick-start the plan it announced on August 29 to overhaul the airline.
Under the plan, Khazanah will inject RM6 billion into MAS, as well as take it private, axe 6,000 jobs, reduce the scale and size of the company, renegotiate contracts and set up a new outfit to take over the operations by July 1 next year.
Jentayu’s plan for MAS will focus on growing the airline business instead of reducing its assets and workforce.
The company plans to acquire Penerbangan Malaysia Bhd (which owns four aircraft), MAS Engineering Sdn Bhd, Firefly Sdn Bhd and 82 planes from MAS’ fleet.
“There is no hidden agenda. We are not testing anything. We want to categorically state that there are no unscrupulous intentions. Tan Sri Abdul Aziz (Abdul Rahman) is our chairman. As many Malaysians know, he has contributed vastly in the legal and airline sectors.
“But we have not heard from Khazanah so far,” Shukor said.
He said Jentayu had the funding in place and identified potential investors from various geographic locations for its plan.
Jentayu, which has an authorised capital of RM100,000, was founded by Abdul Aziz, who was MAS managing director until 1991.
Besides, Shukor, who was an aviation analyst at US rating agency Standard & Poor for over 13 years, the other directors of Jentayu are Feriz Omar of Feriz Omar & Partners (Strategists & Advisors), an investment banking and corporate advisory firm.
The Jentayu team also comprises Datuk Seri Zakaria Bahari, who is group chief executive of Radimax Group Sdn Bhd (formerly, Realmild (M) Sdn Bhd); Datuk Abdul Rahim Mohd Zin, former director of Senai Airport Terminal Services Sdn Bhd; and Daruis Zainuddin, a director of AIA and American Insurance Group.