KUALA LUMPUR, Malaysia – Malaysia’s state investment company said today it plans to remove struggling Malaysia Airlines from the stock exchange, making it fully state-owned before a far-reaching overhaul of its business.
Malaysia Airlines has been hit by two major disasters this year, which added to its long-standing financial woes.
Khazanah Nasional, which owns 69 percent of the carrier, said it plans to buy out minority shareholders at 8 cents a share, a 12.5 percent premium to the airline’s closing share price Thursday.
Khazanah said the delisting will represent the first stage of a “complete overhaul” of the loss-making airline and that detailed plans will be announced by the end of this month.
“The proposed restructuring will critically require all parties to work closely together to undertake what will be a complete overhaul of the national carrier,” it said in a statement. “Nothing less will be required in order to revive our national airline to be profitable as a commercial entity and to serve its function as a critical national development entity.”
In March, Flight 370 from Kuala Lumpur to Beijing disappeared with 239 people on board after flying far off course. The plane still has not been found, with a search in the southern Indian Ocean underway.
In July, 298 people were killed when Flight 17 was shot down over Ukraine. It was heading to Kuala Lumpur from Amsterdam and was shot out of the sky over an area of eastern Ukraine controlled by pro-Russia separatist rebels.
Before the disasters, the carrier’s financial performance was among the worst in the industry, putting a question mark over its future even before its brand was tied to two almost unfathomable tragedies.
Some analysts last month said the airline would not survive a year without a substantial cash injection from the Malaysian government.