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Author: Tan KW   |   Latest post: Fri, 24 May 2019, 6:20 PM

 

Fernandes optimistic of AirAsia's entry into Vietnam by end-2019

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KUALA LUMPUR (April 18): AirAsia Group Bhd group chief executive Tan Sri Tony Fernandes says he is optimistic of the low-cost carrier making another entry into the Vietnam market by end of this year after the first attempt to form a joint venture (JV) there was called off yesterday.

"Vietnam is very much in the plan. I am still optimistic of AirAsia being in Vietnam by end of the year. Watch this space. Picking the right one," he said on his Twitter account.

Yesterday, AirAsia announced to Bursa Malaysia that it has terminated a JV plan with Vietnamese partners to set up a low-cost carrier in Vietnam, but gave no reason as to why it decided to do so.

AirAsia said its wholly-owned subsidiary AirAsia Investment Ltd (AAIL) together with Gumin Company Ltd and Hai Au Aviation Joint Stock Company (HAA) have amicably agreed to terminate and release each other from all obligations in relation to the proposed JV in Vietnam, effective immediately.

Nonetheless, AirAsia said the group remains interested in operating a low-cost airline in Vietnam due to its favourable geographical location, expanding aviation market and overall growth potential.

AirAsia previously announced in March 2017 that it would form a RM194 million (VND1 trillion) JV low-cost airline in Vietnam, with the aim to offer an affordable but high-quality airline service to Vietnamese and foreign tourists.

At that time, AirAsia said AAIL would take up 30 million shares representing a 30% stake for RM58.2 million (VND300 billion), while Gumin would hold 69.99 million shares or 69.9% in HAA, while Tran Trong Kien, the CEO of Thien Minh Travel Joint Stock Company, will hold one share.

In December last year, AirAsia reaffirmed its intention to set up the JV low-cost carrier in Vietnam, when it signed a memorandum of cooperation with Tran and HAA in Hanoi during the Vietnam Travel and Tourism Summit 2018.

At 11.06am today, AirAsia fell 1.21% or 3 sen to RM2.45 with 2.92 million shares traded.

 

https://www.theedgemarkets.com/article/fernandes-optimistic-airasias-entry-vietnam-end2019 

 

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