AirAsia has sold 25 aircraft to Castlelake for $768 million, which the company hopes will free up cash for its digital business plans.
AirAsia Group CEO Tan Sri Tony Fernandes tweeted a statement, which read: “Selling our aircraft monetises all our aircraft at high prices and avoids residual risk, and allows us to return cash to shareholders and invest in our new digital business.
“Between accountants and analysts, investors get a raw deal. MFRS 16 had no impact of cash. I value companies on cash generation. Even with that standard and if you use profit and loss for analysis, the impact of the new standard MFRS 16 is about RM35 million (approximately $8 million) a year. Not very material.”
The disposal will be done via the sale of the group’s entire equity interest in Merah Aviation Asset Holding Ltd, which is held by the group’s indirect wholly owned subsidiary Asia Aviation Capital Ltd (AACL), to AS Air Lease Holdings 5T DAC, an entity indirectly controlled by US-based investment firm Castlelake.