Capital A poised for transformation as it prepares regularisation plan with hopes of PN17 exit
KUALA LUMPUR, 23 October 2024 – Following the shareholders’ approval of Capital A Berhad (“Capital A” or the “Group”) for the disposal of its aviation business to AirAsia X (“AAX”), the Group today announced to Bursa Malaysia Securities Berhad (“Bursa Securities”) its proposed plan to regularise its financial position, which includes a capital reduction to set off against the accumulated losses of the Group. The final plan, expected to be submitted soon, aims to facilitate Capital A’s exit from its Practice Note 17 (“PN17”) status, and is designed to return the Group to a stronger financial standing, enabling future growth and strategic expansion. The details of the announcement has been disclosed to Bursa Malaysia and the link to the full disclosure is here.
Tony Fernandes, CEO of Capital A, said, “This is our final hurdle to release the Group from the financially distressed status that has been hindering our ability to raise capital and grow. As we finalise the regularisation plan and make progress on the disposal of our aviation business, we can now focus on growing our four strong companies within Capital A—CAPAS (aviation services), Teleport, MOVE digital and branding company—all of which have tremendous potential to be leaders in their respective fields. These companies will not only support AirAsia but also help shape the future of the Asian aviation and travel industry. I want to thank all my Allstars for their loyalty and hard work. Special thanks goes to my CFO Mun Hui who has brought us this far as the architect of this transaction, together with our advisers and consultants. The strength of Capital A lies in its people, a value that doesn’t appear on the balance sheet, and I’m beyond thrilled that this announcement marks a new beginning for our Group.”
Mun Hui Teh, CFO of aviation said, “I would like to extend my deepest thanks to Tony for his unwavering faith and for his exceptional leadership that has guided us through this challenging period. We remain hopeful that with the submission of our regularisation plan, we will soon be able to lift up the PN17 status and usher Capital A into a new era of stability and growth. After this, we will have a clean book and a clear set of financials that truly reflect the performance and potential of our non-aviation businesses.”
Additionally, Capital A has decided to terminate the Business Combination Agreement (“BCA”) between Aetherium and Capital A International for a planned SPAC listing in the US. The decision was made after Aetherium received a Delisting Determination from NASDAQ in June 2024. Nevertheless, once the regularisation plan is completely executed, Capital A will revisit the idea of listing its four core businesses, starting with the branding company in the US stock market.
Fernandes added, “The termination of the BCA was a strategic decision. We are laser focused on completing the regularisation plan, which has been kept simple, mostly consisting of the capital reduction process. Once the regularisation plan is successfully completed and we exit PN17 status, we will resume our plan to individually list all of our businesses. Timing is of the essence, and this move ensures we prioritise what's critical and maintain momentum.”
With the regularisation plan in sight and the support of its shareholders, Capital A is well-positioned for a brighter financial future. The company’s streamlined focus on its core pillars will drive growth and further strengthen its position as a leader in aviation and travel industries across Asia.
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