Malaysia: Airasia Forms JV To Establish Low-Cost Carrier In Vietnam

KUALA LUMPUR, March 31 (Bernama) -- Malaysian low-cost airline, AirAsia Bhd's unit, AirAsia Investment Limited, has formed a joint-venture (JV) with Gumin Company Ltd and an individual, Tran Trong Kien, to establish a low-cost carrier in Vietnam. In a filing to Bursa Malaysia Friday, AirAsia said the JV vehicle, Hai Au Aviation Joint Stock Company which has a paid-up charter capital of RM19.4 million (US$1 = RM4.42), currently operates a general aviation business in Vietnam. AirAsia Investment will hold a 30 per cent stake in the JV company, Gumin will hold 69.9 per cent and Tran Trong Kien will own the remaining share. "The JV will require a capitalisation of RM194 million and AirAsia will contribute its share of RM58.2 million (for 30 per cent) which will be raised through internal funding. "The JV, subjected to regulatory approvals, was expected to commence operations by early 2018," AirAsia said. It said this move would offer great potential for growth in Vietnam given its sizeable population of 95 million. The airline also said Vietnam's middle-class population was expected to represent 23 per cent of the total population by 2020, which would further fuel the growth for air travel. -- BERNAMA