AirAsia has decided against selling-off its subsidiary Indonesia AirAsia in an IPO, citing the airline’s recent poor financial performance.
AirAsia Group CEO Tony Fernandes said: “Indonesia AirAsia is not making money, so going for an IPO without a good financial record is not the norm. It is also not my style. AirAsia moving forward would also like to own more of these airlines [affiliates]. Just like banking and telecoms, I am sure ASEAN airlines will one day be allowed to be 100%-owned by another ASEAN company.”
Fernandes reiterated that AirAsia would take the subsidiary public only when it made financial sense to do so.
The original plans to raise $200million by offering 20% of Indonesia AirAsia's shares in an IPO were dropped due to a declining Indonesian Rupiah. Later plans to hold the IPO this year were also postponed until after the recently-concluded presidential elections.
Indonesia AirAsia is a 49%/51% joint venture between the Malaysian LCC and its wholly-owned Indonesian investment vehicle, PT Fersindo Nusaperkasa.