AirAsia X Acquires Capital A’s Aviation Business in Major Industry Move

Credit: AirAsia

In a strategic acquisition that marks a significant consolidation in the airline industry, AirAsia X (AAX), the Malaysian long-haul budget airline, has entered into an agreement to acquire the aviation business of Capital A Bhd. This acquisition will see AirAsia X merging with AirAsia Berhad (AirAsia Malaysia) and AirAsia Aviation Group Limited (AAGL), which includes AirAsia subsidiaries in Thailand, Indonesia, the Philippines, and Cambodia.

The deal aims to position AirAsia X as the primary regional aviation provider under the AirAsia brand, bringing all short and medium-haul routes under this single entity. This move is expected to deliver several benefits including strengthened market positioning, increased operational efficiency, and enhanced financial performance. Dato’ Fam Lee Ee, AirAsia X Chairman, highlighted the strategic importance of this acquisition in bolstering AAX’s financial stability and market positioning, especially as a key element in AAX’s post-PN17 revival strategy.

The financial details of the acquisition have not been disclosed yet but are expected to be announced soon. The non-binding letter of offer has already been signed, and the formal sale and purchase agreement is anticipated to be finalized within the next two weeks.

The separation of the aviation business from Capital A is also seen as a strategic move to enhance the visibility and potential of Capital A's non-aviation businesses. These include Teleport (logistics), Capital A Aviation Services (maintenance, repair and overhaul, and in-flight services), and MOVE digital (formerly the airasia SuperApp). This restructuring is expected to create a more focused investment and shareholder base, unlocking greater value for shareholders. Post-acquisition, Capital A shareholders will become shareholders of two strong listed entities, providing clearer investment opportunities and potential growth.