Malaysian budget airline AirAsia X announced it has completed its debt restructuring and aims to write nearly $7.86 billion back to profits in the next quarter of 2022.
On March 16, 2022, AirAsia X lodged the Sanction Order for its debt restructuring, where the airline said the formalities of the restructuring had now been completed.
“The lodgement of the Sanction Order means that […] AAX will be able to reverse RM33 billion [$7.86 billion] of liabilities and provisions for liabilities which have been waived under the scheme,” an AirAsia X statement reads.
The long-haul airline proposed a restructuring plan to prevent liquidation after it was severely hit by the global pandemic and posted a record $5.9 billion quarterly loss in September 2021.
Following the terms of the debt restructuring proposal, which was approved by both AirAsia X’s creditors and the High Court of Malaya in December 2021, the carrier agreed to terminate existing contracts and pay 0.5% of the almost $8 billion debt owed.
“This is another significant step in rebuilding AAX, post-pandemic. We are returning to the skies in a robust position where we can once again offer the best value fares and customer service excellence which our customers deserve,” the airline’s chief executive officer, Benyamin Ismail said in the statement.
According to the CEO, the recent completion of the debt restructuring will now pave the way for the proposed $119 million fund raising.
Ismail continued: “We look forward to offering more value for money services across our core network in tandem with cargo and consumer demand. In the next two months, we will recommence passenger services to several more international destinations in line with borders reopening with exciting offerings for guests and particularly to the customers that have travel credits with us.”