Malaysia/Malaysia Airlines/De-listing

MH370 DECODED
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Malaysia Airlines De-Listing


Malaysian Airline System Bhd[1] was the holding company for Malaysia Airlines.

Malaysian Airline System (MAS) was described as 'government owned' because the majority shareholding was held by Khazanah Nasional Berhad which is a government-owned investment company[2].

On 8 March 2014 Malaysia Airlines flight MH370 lost contact between Kuala Lumpur and Beijing, continued to fly for several hours and is believed to have crashed in the southern Indian ocean.

On 17 July 2014 Malaysia Airlines flight MH17 was shot down over eastern Ukraine.

On 8 August 2014 the Prime Minister (Malaysia) announced changes to Malaysian Airline System Berhad as a necessary response to those two events. (The company was operating at a loss even before these two tragedies).

A copy of the Statement is below:-


Friday, 8 August 2014, PUTRAJAYA, Statement By: YAB. DATO' SRI MOHD NAJIB BIN TUN HAJI ABDUL RAZAK, PERDANA MENTERI MALAYSIA


STATEMENT ON MALAYSIA AIRLINES DE-LISTING


Pejabat Perdana Menteri


Today, the Government of Malaysia, through its strategic investment fund Khazanah Nasional Berhad (Khazanah), announced a formal process to take full ownership and de-list Malaysian Airline System Berhad (MAS). This is the first step needed to return our national carrier to profitability. It is a step I wholeheartedly support.

MAS is part of Malaysia’s history. It is a symbol of national pride, of our ambitions and our place in the world. It is more than just a company to us. So today we are making changes to ensure it is also part of Malaysia’s future story.

Like all Malaysians, I am deeply saddened by the losses of MH370 and MH17. Seldom before has a company been subjected to two profound and extraordinary tragedies in such a short space of time. We pay tribute to the victims; we pray for their families; and we thank all those around the world for their support and their prayers in these difficult times.

We hope these twin tragedies will change the way the aviation industry operates, making global travel safer for all. But we must also acknowledge that they will change the way MAS operates, too.

We believe our national carrier must be renewed. This means wholesale change, to deliver a wholly different outcome. Only through a complete overhaul of the company can we deliver a genuinely strong and sustainable national carrier. Piecemeal changes will not work.

This process of renewal will involve painful steps and sacrifices from all parties. My instruction and my commitment to all concerned is that the process will be carried out professionally, with proper principles of fairness, transparency and compassion.

It is therefore critical that all parties close ranks and work closely together. Without the full support of all parties – management, employees, unions, creditors and vendors – as well as loyal passengers and the Malaysian people – this restructuring will not succeed.

The Government and Khazanah are in the final stages of completing a comprehensive and holistic restructuring plan. With due process and following the relevant approvals, we expect that a detailed plan will be announced before the end of August.

MAS is our national carrier, and our national pride. The changes that start today will lay the foundations for its future success. I ask that all Malaysians continue to support Malaysia Airlines, as we build a stronger and more sustainable national carrier.


DATO’ SRI MOHD NAJIB


8 August 2014


Source: Media Statements by PM Najib Razak are available from Office of the Prime Minister, Putrajaya, Malaysia.
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Subsequent Changes
  • In December 2014 the MALAYSIAN AIRLINE SYSTEM BERHAD (ADMINISTRATION) BILL 2014[3] was presented to parliament;
  • Malaysian Airline System was de-listed from the Malaysian stock exchange;
  • Khazanah Nasional purchased shares it did not already own;
  • Christoph Mueller was appointed as the new CEO and would take over that position when his contract with Aer Lingus ends;
  • From 1 July 2015 Malaysia Airlines Bhd would be operated by a new company called MAS NewCo.[4]
  • The parent company is known as the Malaysia Aviation Group (MAG)[5].
  • The domain name and URL for Malaysia Airlines website is unchanged at www.malaysiaairlines.com but all previous references to MH370 and MH17 were removed when the website was upgraded.




References
  1. In the company name Malaysian Airline System Berhad or Malaysian Airline System Bhd - the word berhad means private and in Malaysia is used for a private limited company. See www.investopedia.com/terms/b/bhd-berhad.asp
  2. www.investopedia.com/terms/k/khazanah-nasional.asp
  3. www.cljlaw.com/files/bills/pdf/2014/MY_FS_BIL_2014_31.pdf
  4. Article Malaysia Airlines has appointed Christoph Mueller (Aer Lingus head) as CEO klse.i3investor.com/blogs/valueinvestorresearchklse/66055.jsp
  5. See https://www.malaysiaairlines.com/my/en/about-us/malaysia-aviation-group.html