Malaysian low-cost carrier AirAsia’s Thai associate, Thai AirAsia, is set for an ownership change after its Thai parent company became majority foreign-controlled. AirAsia is scrambling to finalise a deal with prospective new Thai partners to bring the airline back to at least 50% local ownership.
The change became necessary after Singapore government investment arm Temasek Holdings acquired an indirect stake through its purchase of a sizeable shareholding in Shin Corp, Thai AirAsia’s 50% owner. This lifted the carrier’s de facto foreign ownership content to well above 50%, breaching Thai regulations in air services agreements.
Shin Corp, which has wide-ranging business interests including in telecommunications, was until Temasek’s takeover controlled by the family of Thailand’s prime minister, Thaksin Shinawatra. AirAsia owns 49% of Thai AirAsia while Thai AirAsia chief executive Tassapon Bijleveld, a Thai national, has 1%. It is thought the terms of the joint venture agreement dictate that AirAsia is able to retain its shareholding in almost any circumstance, requiring Shin Corp to sell.
AirAsia and Temasek were considered unlikely partners in any case as Temasek has a majority stake in Singapore Airlines and minority stakes in two low-cost carriers in Singapore, Tiger Airways and Jetstar Asia.
Meanwhile, AirAsia is to have its tickets sold through travel agents by way of a tie-up with global distribution system (GDS) provider Galileo International. A deal has been agreed under which the airline’s fares and inventory will be made available on the Galileo Flight Integrator GDS platform, giving the carrier sales prospects through 50,000 travel agencies.
It marks a shift in its direct sales policy, as it has traditionally sold directly to passengers through the Internet and its telephone call centres. ■