MAS/AIRASIA DEAL IS OFF

As expected the swap deal between Malaysia Airlines (MAS) and AirAsia is off. This is to confirm earlier rumours that a combination of union pressure, concerns over conflict of interest and the upcoming general election would force the national carrier’s hand over the issue. Trading of MAS and AirAsia shares has been suspended to make way for an official announcement later today. The dissolution of the comprehensive collaboration framework signed last August is likely to see AirAsia’s Tony Fernandes and Kamarudin Meranun exit the MAS board. On the flip side, the cooperative spirit of the agreement is set to continue, with MAS and AirAsia expected to persist in collaborations on procurement, pilot training, and maintenance support and repair services, in an attempt to secure cost savings. The carriers are expected to establish several joint venture companies to facilitate this collaboration. Corporate figures seem to forget that running airlines is not only about putting planes in the air. It is more about motivating the human resource so that they can feel proud of their airlines and will put every effort to make it a success.