MALAYSIA Aviation Group Bhd (MAG), at the tail end of a RM16 billion debt-restructuring exercise of Malaysia Airlines Bhd, said it is studying the option of using a UK scheme to complete the exercise.

MAG, the parent of the loss-making national carrier, said in a statement yesterday the UK option, however, is dependent on the sanction of a group of minority creditors still holding out on the proposed restructuring plan.

MAG, which has set the first quarter of this year to complete the exercise, is negotiating with about 40 creditors, lessors and key suppliers to accept a cut on their outstanding debt as part of the restructuring plan.

Group chief executive officer Capt Izham Ismail, who also serves as group CEO of Malaysia Airlines, told The Edge on October 12 that once MAS has the support from creditors for its debt plan, it will file the plan with the UK courts for court sanction.

Khazanah Nasional Bhd, MAG’s sole shareholder, will follow up by injecting new capital into the airline to continue keeping it flying until the expected full recovery in the domestic and Asean air travel markets expected next year.

MAG said “good progress has been achieved with full support by a large majority of its creditors for a consensual agreement”.

“MAG is confident that it will achieve a win-win situation with all creditors involved and looks forward to executing its revised long-term business plan alongside its partners,” it added.

The liquidity position of the MAG group of companies stood at RM366 million as of August 31 last year.

It could also draw on the RM578 million made available by Khazanah.

The airline could be forced to fold up if the restructuring plan fails. – January 7, 2021.