CAPITAL A Bhd is targeting to exit its PN17 status by May, pending approval from its shareholders and the High Court regarding its Regularisation plan.
Capital A Chief Executive Officer Tan Sri Tony Fernandes revealed, in a statement today, the company will convene an extraordinary general meeting (EGM) in April, where shareholders will vote on and approve the plan.
Following this, Capital A will seek the High Court’s approval to move forward.
"At lunch time today, we are confirming when the High Court will approve the capital reduction for AirAsia Aviation," Fernandes said, adding that the company will announce the court date soon.
Once the PN17 status is lifted, Capital A plans to divest its aviation business to AirAsia X Bhd, which will then rebrand itself as AirAsia Group.
This strategic move is expected to help streamline the company's operations and strengthen its financial position moving forward.
"At lunch time today, we are confirming when the High Court will confirm the capital reduction of for AirAsia Aviation," he said today, adding that Capital A will announce the court date soon.
Once Capital A exits its PN17 status, the company will sell its aviation business to AirAsia X Bhd. AirAsia X will then change its name to AirAsia Group.
Capital A prioritises debt deduction over dividend payments
Fernandes added the company will not resume dividend payments in the near future, as the company is focused on restructuring and reducing its debt, particularly from the COVID-19 pandemic.
In a press conference at the Capital A - Next Chapter event today, he said the company’s top priority is to clear the debts accumulated during the pandemic, especially within its aviation segment, before considering any future dividends.
“My priority is to clear the debt incurred during COVID-19. Once we have done that, we will look at dividends, which will take between three and four years,” he explained.
The company, which last paid a dividend in the financial year ending December 31, 2019, of 90 sen per share, is undergoing a significant restructuring process aimed at exiting its Practice Note 17 (PN17) status. Capital A anticipates completing this process by May 2025, subject to shareholder and High Court approvals.
Fernandes said any profits generated by the company will be reinvested into its expanding business ventures, such as its logistics arm, Teleport, and its food brand, Santan, rather than being distributed to shareholders.
"Whatever profit, we are going to re-invest it, just like we do with Teleport and Santan,” he added.
The CEO’s comments reflect Capital A’s strategy to reinforce its financial stability and position itself for long-term growth before resuming dividend payouts.
On Friday, Fernandes said the approval of its Proposed Regularisation Plan by Bursa Malaysia Securities Berhad (Bursa Securities) marks a significant step toward the company’s exit from Practice Note 17 (PN17) status, setting the stage for a stronger and more sustainable future.
The approval from Bursa Securities, granted via an official letter dated 7 March 2025, provides a clear path for Capital A to complete its restructuring and restore its financial standing.
With this green light, the company is now poised to finalise the implementation of its plan, including capital reduction to set off accumulated losses and the reorganisation of its business units to unlock long-term value for shareholders.
“This is a monumental day for Capital A. I am beyond words. After an extensive restructuring process, we now stand at the threshold of exiting PN17 status.
Our journey has been focused on rebuilding our financial foundation, and with today's announcement, we take a giant leap toward a future of financial strength and operational excellence.
“This is not just about numbers or regulatory approvals—it’s about resilience, about proving that we can come back again, stronger than ever.
“We are fully committed to executing the plan and delivering even greater value to all our stakeholders, including our customers and our incredible Allstars who never gave up. The best is yet to come!” he said.
The Proposed Regularisation Plan is structured to ensure compliance with Bursa Securities’ listing requirements and includes a series of financial and structural adjustments designed to stabilise and grow Capital A’s business.
The approval is subject to the fulfillment of certain conditions, including compliance with all regulatory requirements, obtaining necessary shareholder approvals, and submitting final confirmations of the plan’s completion.
Capital A CFO Mun Hui Teh, and the architect of the restructuring plan said: "Securing Bursa’s approval is a testament to the hard work, relentless dedication, and strategic direction of Capital A. I want to extend my deepest gratitude to Tony (Fernandes) and the entire leadership team for their trust, guidance, and unwavering belief in this vision.
“This plan will enable us to clean up our balance sheet, realign our core businesses, and ultimately exit PN17 status. We are closer than ever to achieving our goal, and we can’t wait for the exciting future ahead to unfold.”
Following the completion of the Proposed Regularisation Plan, Capital A will be in a stronger position to execute its long-term vision.
The company remains committed to growing its six core businesses—Asia Digital Engineering (ADE), Teleport (Logistics), AirAsia MOVE, Santan, BigPay and Abc. International.
This milestone reflects Capital A’s transformation from a financially distressed company into a group with agile, technology-driven businesses that are ready to capitalise on new opportunities in aviation, engineering, logistics, digital travel, and brand management. - March 10, 2024
