Khazanah Nasional, Malaysia’s sovereign wealth fund, intends to delist national aircraft carrier Malaysia Airlines, buying out minority shareholders following the business' two disasters this year, according to a statement.
The firm, which acts as the strategic investment fund for the Government of Malaysia, will pay RM0.27 ($0.08; €0.06) per ordinary share in the business, a 12.5 percent premium over its closing price on 7 August 2014 – the day before the announcement – and a 29.2 percent premium over its three-month volume weighted average market price.
The value of the buyout is expected to reach about $429 million.
In June, Khazanah said it was undertaking a full, comprehensive review of Malaysia Airlines, in consultation with special shareholder the Minister of Finance Incorporated.
It went on to say it would announce a restructuring scheme for the business within six to 12 months, of which the delisting is the first step.
“We reiterate that the proposed restructuring will critically require all parties to work closely together to undertake what will be a complete overhaul of the national carrier on all relevant aspects of, inter alia, the airline’s operations, business model, finances, human capital and regulatory environment,” a Khazanah statement said.
“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.”
Malaysia Airlines has been stooped in scandal recently as two of its passenger aircrafts crashed on separate occasions during 2014, both expected to have killed all on board.
The major airline’s business operations started suffering after the first disaster on 8 March 2014, when flight MH370 disappeared. It suffered further trouble on 17 July 2014 in a second tragedy, when its passenger jet MH17 was shot down over the Ukraine, killing all 298 people on board.
Khazanah did not refer directly to the crashes in its statement, but expects to provide additional detailed plans for the business by the end of this month.