AirAsia eyes war chest expansion via Nasdaq listing

Capital A Berhad, the investment holding company of budget carrier AirAsia, is planning to list its brand management and leasing businesses in the US Nasdaq stock exchange to expand access to financial war chest.

The company has entered into a Letter of Intent with Aetherium Acquisition Corp., a Special Purpose Acquisition Company listed on the Nasdaq stock exchange, for a proposed business combination merger with Capital A International, to be incorporated.

Leverage 'AirAsia' brand

The plan would effectively establish Capital A International, a new investment and strategic development company that would leverage the "AirAsia" brand.

The proposed business combination will be at an indicative equity value of $1 billion based on an independent valuation of the AirAsia Brand.

It will capitalize on core capabilities in aviation, travel and hospitality, and digital technologies, becoming a standalone publicly traded company in the US.

With 100 percent equity interest in AirAsia Brand and Leasing, Capital A International intends to generate revenue from brand royalty and the leasing of aircraft.

Additionally, it will be involved in tactical acquisition, incubation, and partnerships to provide platforms for entrepreneurs.

Coming-of-age moment

"This is a coming-of-age moment for Capital A, which has morphed from AirAsia into a low-cost, value-driven aviation and travel services group in five entities, the first of which that's coming to the public market would be Capital A International," Capital A CEO Tony Fernandes said.

"We are taking the first step to venture out of our home ground, which is ASEAN, and exploring listing on the pinnacle of markets in terms of capital raising," he added.

Fernandes said he is confident that the exposure to the US financial markets and Nasdaq listing would help the company generate additional financial warchest. 

Transformative impact

Meanwhile, Jonathan Chan, CEO of Aetherium Acquisition Corp., said, "lt is a privilege to be working with a storied entrepreneur such as Tony Fernandes to help bring Capital A International to the US capital markets. AirAsia has had a transformative impact on the lives of tens of millions of people across Southeast Asia, making affordable air travel a reality."

Under the terms of the LOI, Capital A plans to divest all issued and outstanding share capital of Capital A International.

The LOI with Aetherium Acquisition Corp. reflects a mutual interest in the potential collaboration, subject to necessary regulatory approvals and conditions from Bursa Securities, the Central Bank of Malaysia, and other relevant authorities.