Friday, May 27, 2022

No Danajamin loan for Capital A after top duo refuse to be guarantors

It says it is exploring other available debt financing alternatives with acceptable terms suitable to the operations and financing requirements of the company.

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AirAsia Group Bhd which recently rebranded itself as Capital A Bhd today announced that it is unable to proceed with its acquisition of a RM500 million club facility under Danajamin Nasional Bhd’s Prihatin Guarantee Scheme as its founders will not act as guarantors.

Capital A said in a filing with Bursa Malaysia that it would not be proceeding with the club facility as it was unable to accept and/or fulfil certain conditions including a joint and several guarantee from Tony Fernandes and Kamarudin Meranun.

It also said that it could not meet Danajamin’s requirement for it to regularisation plan and obtain approval to remedy its consolidated shareholder equity to above RM40 million and 25% of its share capital exclusing treasury shares, or to obtain an extension of time to provide the regularisation plan from Bursa Malaysia for the matching tenure of the Danajamin club facility.

“Capital A is exploring other available debt financing alternatives with acceptable terms suitable to the operations and financing requirements of the company,” it said.

Capital A as AirAsia received approval from Danajamin on Oct 5 for an 80% guaranteed loan of up to RM500 million under its Danajamin Prihatin Guarantee scheme.

This was part of the government’s economic stimulus packages to cushion the impact of the Covid-19 pandemic.

AirAsia was classified as PN17 on Jan 13 after Bursa Malaysia dismissed its appeal to extend by 18 months its clearance period ending Jan 7.

Speaking on Jan 28 at the launch of Capital A, though, Fernandes brushed aside the label, calling it “an accounting issue”.

“The solution has nothing to do with liquidity,” he said. “PN17 was caused by a lease which we never paid, so it shouldn’t be in the profits and losses.

“It’s related to accounting and structuring, which mentions the consolidation of a RM5 billion deficit. If you remove these two factors, we would not be classified as PN17.”

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