AirAsia X seeks help from creditors to pay its debt worth $15.3 billion

On Thursday, AirAsia X Berhad (AAX) announced its plans to drop a local airport operator from its restructuring plan debt worth $15.3 billion.

According to Malaysia’s budget airline, the move was made to expedite discussions with creditors as its cash funds are running out fast.

“Everyone in the aviation industry is affected now. It’s unreasonable to expect AAX to pay the huge liability at a time when planes are not flying,” CGS-CIMB Research’s Analyst Raymond Yap said.

“Creditors holding a minimum of 75% of the unsecured debts must approve the debt restructuring proposal for it to pass. Chances are many of them will take it,” he added.

AirAsia X stated that it seeks to reconstitute its $15.3 billion debt into 200 Million Ringgit ($48 million) and have the rest waived.

However, Malaysia Airports Holdings Bhd (MAHB) filed a lawsuit on Saturday to claim 78 Million Ringgit ($18.74 Million) from AirAsia X.

“The aviation industry is facing very challenging and difficult times due to the pandemic. All airline companies and airports are facing the same prospect in terms of traffic contraction and loss of revenue. While some airline companies have inevitably collapsed due to the extreme business conditions, airports are facing the same extreme conditions,” Malaysia Airports Holdings said in a statement.