Malaysia

AirAsia Group Bhd. has stopped funding its Indian affiliate as the global travel slump leaves the Malaysian group struggling to support a sprawling empire of no-frills airlines, people familiar with the matter said, Bloomberg News reported. AirAsia India Ltd.’s future may now depend on Indian conglomerate Tata Group, its majority shareholder, which has provided emergency funding but has yet to commit to a full rescue, according to the people, who asked not to be named discussing a confidential matter. The airline isn’t at any immediate risk of folding, the people said.

Malaysia Aviation Group, the holding company for Malaysia Airlines Bhd, said in a letter to lessors the group is unlikely to be able to make payments owed after November unless it receives more funding from state fund Khazanah, Reuters reported. The letter, reviewed by Reuters, follows a request by the troubled carrier for steep discounts on aircraft rentals from its lessors as part of a broad restructuring plan, three sources with knowledge of the matter said.

More corporates are expected to descend into defaults as the business disruption brought about by the Covid-19 pandemic continuing to unfold resulting in significant financial and operational restructuring across many industries, The Malaysian Reserve reported.

AirAsia Group Bhd. is seeking to raise as much as 2.5 billion ringgit ($600 million) by the end of the year as it tries to survive a business slump exacerbated by the coronavirus pandemic, Bloomberg News reported. The Subang, Malaysia-based budget carrier may borrow up to 1.5 billion ringgit from banks and another 1 billion ringgit from investors, a spokeswoman said Tuesday.

AirAsia Group Bhd.’s long-haul arm said it needs to reach agreements with major creditors to restructure outstanding debt as it faces “severe liquidity constraints” that threaten its ability to resume flying and continue as a going concern, Bloomberg News reported. The warning came in an exchange filing Wednesday, in which AirAsia X Bhd. also reported a net loss for the three months ended June 30 of 305.2 million ringgit ($73 million), worse than a 207.1 million ringgit deficit a year ago. Sales tumbled 91% to 91.4 million ringgit.

Goldman Sachs Group Inc. will pay $2.5 billion to the government of Malaysia for its role in the alleged theft of billions of dollars from a government investment fund, bringing the Wall Street bank close to ending one of the worst scandals in its history, The Wall Street Journal reported. Goldman also guaranteed the recovery of $1.4 billion in assets allegedly stolen from the fund, according to the agreement announced separately by the bank and Malaysia’s Finance Ministry on Friday.

The debt burden currently faced by TH Plantations Bhd (THP) cannot be resolved via asset sale but rather a restructuring of its debt, said Deputy Minister in the Prime Minister’s Department (Religious Affairs) Ahmad Marzuk Shaary, The Edge reported. Speaking in the Dewan Rakyat today, Ahmad Marzuk raised the suggestion on grounds that the bulk of THP’s debt goes to parent Lembaga Tabung Haji, and that asset sale will negatively impact THP’s cash flow rather than improve it. “About 75% of the loans by THP came from Tabung Haji.

Southeast Asian low-cost carriers, a key growth engine for planemakers and leasing companies for a decade before the pandemic, are faltering financially as demand plunges, raising questions over whether they can replace and double their fleets, the International New York Times reported on a Reuters story. Auditors for Malaysia's AirAsia Group Bhd and Vietnam's VietJet Aviation JSC are concerned about cashflows and funding, while Indonesia's Lion Air has put the brakes on a planned flotation.

Malaysia’s banks will offer broader loan deferrals that will involve 100 billion ringgit ($23 billion) of funds as the country seeks more ways to soften the pandemic’s impact on its economy, Bloomberg News reported. Banks will offer six-month deferrals for all loans held by individuals and small businesses and let people convert their credit card debt into a three-year term loan, the central bank said in a statement Wednesday.

Icon Offshore Bhd has received the nod from its shareholders to move forward with its debt restructuring and cash call proposal, which will greatly help reduce the debt burden that has eaten into the company's earnings, The Edge reported. Icon's second largest shareholder, Urusharta Jamaah Sdn Bhd, which owns an 8.8% stake in the group, indicated at the group's extraordinary general meeting (EGM) today to support the cash call to raise up to RM250 million, the bulk of which will be used to reduce the group's debt and gearing.