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KUALA LUMPUR (Reuters) – All three groups of creditors of Malaysian long-haul low-cost airline AirAsia X have agreed to a restructuring scheme that proposes to pay just 0.5% of debt owed and to terminate all existing contracts, a person familiar with the matter said.
AirAsia X said on Friday the first of three groups had voted 100% in favour of the plan to restructure 33.65 billion ringgit ($8.1 billion) of liabilities.
The proxy votes for the other two groups were also heavily in favour, the person told Reuters on condition of anonymity, confirming an earlier report by Bloomberg News.
An AirAsia X spokesperson declined to comment, saying voting was ongoing.
AAX last month said the airline faced liquidation if creditors did not agree to the plan.
It is one of many carriers in the Asia-Pacific region to have entered a court-overseen debt restructuring process to survive the pandemic. Others include Malaysia Airlines, Virgin Australia, Thai Airways and Philippine Airlines.
AAX needs 75% of each of the three classes of creditors to approve the plan for it to proceed.
The first class of AAX creditors includes airports, financial institutions and maintenance providers, according to a 127-page explanatory statement for the creditors meeting seen by Reuters.
The second class includes engine suppliers, lessors, trade creditors, travel agents and passengers, the document said, while Airbus, the largest creditor, is the only one in the third class.
Half of the airline’s total liability is the cost of terminating airplane orders from Airbus for 78 A330neo widebodies and 30 A321neo narrowbodies, the document said.
AAX also said it is in negotiations with lessors of 29 planes and certain other creditors on commercial terms for continued or future business relationships.
