Money Briefs: AirAsia to sell aircraft leasing unit as early as Dec

AirAsia to sell aircraft leasing unit as early as Dec

AirAsia expects to sell its aircraft leasing unit as early as December, with the largest customer for Airbus Group's single-aisle jets aiming to net as much as US$1 billion (S$1.36 billion) from the transaction and pare its debt.

Proceeds from the sale may be used to reduce debt or pay a dividend, group chief executive Tony Fernandes said in a Bloomberg Television interview yesterday.

AirAsia's board approved the sale process for all or a substantial part of the unit, Asia Aviation Capital, the carrier said in a filing on Monday. "Depending on who the buyer is, and there seems to be tremendous interest, we'll likely divest all or maybe keep a minority interest for a period and sell out," Mr Fernandes said.

Hanjin Shipping's creditors reject revamp plan

Creditors of Hanjin Shipping will stop supporting South Korea's biggest container shipping line as restructuring plans submitted by the company are insufficient to tide over its cash shortage. 

The restructuring plans fall short of requirements by creditors for them to help Hanjin Shipping, its main creditor Korea Development Bank said in a statement yesterday.

The firm may still need 1 trillion to 1.3 trillion won (S$1.2 billion to $1.6 billion) in cash even after it agreed to charter-rate adjustments with ship owners and extended the maturities of some loans, the state-run lender said.

"While Hanjin Group has shown some efforts to turn around, the owner hasn't shouldered enough responsibility as head of the company," Mr Lee Dong Geol, Korea Development Bank's chairman, said at a briefing in Seoul. "The voluntary debt-restructuring programme is until Sept 4 and Hanjin Shipping will probably have to decide whether to file for court receivership."

A version of this article appeared in the print edition of The Straits Times on August 31, 2016, with the headline 'Money Briefs'. Subscribe