Thursday, November 10, 2011

AirAsia X waiting on markets for IPO, won't pull it

TAIPEI (Nov 10):'' Malaysian low-cost airline AirAsia X wants to see an improvement in the economic climate and markets before its planned public share offering, but there is no possibility it will scrap the plan, its chief executive said on Thursday.

Azran Osman-Rani told a media presentation in Taipei that it would carry on preparing for the share offer, but would want to see an end to market uncertainty first.

"We're still going ahead and doing all the work that needs to be done," he said.

"When you actually pull the trigger and file and go to market, a lot of that depends on the state of global equity markets and right now there's just so much uncertainty."

AirAsia X, the longhaul low-cost arm of Malaysia's AirAsia , said in October that it would make an initial public offering of shares in 2012. It has not given the size of the planned IPO.

"How many companies are doing an IPO right now? Forget about AirAsia X, forget about the airline industry, just across the board," Azran said.

"We'd like to see some success stories of IPOs first to prove that investors are coming back into equities again," he said.

AirAsia X has 11 aircraft and flies to destinations including Tokyo, London and Melbourne from its base in Kuala Lumpur. AirAsia owns 16 percent in AirAsia X, while billionaire Richard Branson's Virgin Group holds 10 percent and Japan's Orix Corp has 11 percent.

AirAsia X operates in a crowded Asian low-cost carrier scene, with many of the region's top airlines launching cheap offshoots to boost.

Low-cost carriers accounted for 16 percent of the market in terms of seats within Asia Pacific last year, up from 6 percent in 2005, according to the Centre for Asia Pacific Aviation, a market intelligence provider

Their market share is set to rise 2 percentage points annually to about 26 percent in 2015, it said.

Boeing Co said in its latest market update this month that overall air travel in the Asia region will grow at an annual rate of 6.6 percent to 2030. - Reuters

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