Kuala Lumpur,29th August-2014,(IANS):Malaysia Airlines (MAS) is set to slash 6,000 jobs and cut routes as part of a major revamp after suffering the loss of two commercial jets this year, the Straits Times reported Friday.
State wealth fund Khazanah Nasional, which controls the flag carrier, said it would inject 6 billion Malaysian ringgits (around $1.9 billion) over three years into a new company that will house the airlines.
Malaysia Airlines to cut 6,000 jobs
The turnaround plan will see 30 percent of its 20,000 employees losing their jobs as it resets the operating business model, which will see route cuts, to be regionally-focused, while taking advantage of global connectivity with code-share and Oneworld alliance partners.
The plan will enable MAS to achieve sustained profitability within three years of de-listing, by the end of 2017, Azman Mokhtar, Khazanah managing director, said.
The funding includes cost of de-listing, restructuring and retrenchment.
Khazanah said that it would buy the remaining 30.6 percent of MAS which it does not already own for a total of RM1.38 billion to de-list the company, although sources say some significant shareholders may hold out for more than the 27 percent per share offer.
The move comes on the back of the shooting down of flight MH17 over Ukraine in July, just four months after flight MH370 vanished en route to Beijing from Kuala Lumpur March 8.
Khazanah is searching for a chief executive to head the new company and hopes to announce its candidate by the end of the year after consultation with Malaysia’s finance ministry.
The ailing national carrier Thursday announced yet another quarter of widening losses — a period sandwiched by the two tragic events that rocked the loss-making outfit — after losing RM307 million from April to June, up 75 percent year-on-year.
It was the sixth straight quarterly loss for the airlines that is saddled with a RM12-billion debt, and the company expects the full impact of the twin tragedies to be felt in the second half of the year.
The carrier has lost 19 percent of its market value this year, having racked up nearly RM5 billion in losses since 2011.