KUALA LUMPUR (Jan 8): Shares in AirAsia X Bhd (AAX) edged higher after noon break on Monday, following news of a consolidation plan that will see it taking over from sister company Capital A Bhd all short-haul flight operations in Malaysia, Thailand, Indonesia, and the Philippines for an undisclosed amount.

The counter rose 14 sen or 7.29% to reach an intraday peak of RM2.06 — its highest in two months — during the afternoon trading session, before paring gains to RM2.03 at the time of writing, still up 11 sen or 5.73%, giving it a market capitalisation of RM898.62 million.

It saw a total of 50.47 million shares changing hands.

Meanwhile, investors of Capital A were less excited about the news, with the counter rising 3.5 sen or 4.21% to hit an intraday high of 86.5 sen, before settling up two sen or 2.41% at 85 sen, valuing the company at RM3.62 billion.

About 35.18 million shares were traded.

Earlier, Capital A's chief Tan Sri Tony Fernandes highlighted the group's plan to dispose of its airline businesses to sister company AAX, with the consideration to be negotiated at a later date in both cash and shares.

Fernandes said while details of the overall valuation had not been revealed, official agreements are expected to be signed within the next two weeks.

Once the transfer is completed, Capital A will continue to operate four businesses, namely Teleport, Santan, BigPay and ADE, focusing on serving its existing customer base in these markets.

AAX will undergo a rebranding process and become known as AirAsia Aviation Group, while maintaining its current headquarters at klia2 RedQ. Meanwhile, Capital A will move its headquarters to Damansara Heights.