Connect with us

Hi, what are you looking for?

Capital Business
Capital Business

World

Ex PM Mahathir criticises Malaysia Airlines takeover

Ex-PM Mahathir criticises Malaysia Airlines takeover/AFP

Ex-PM Mahathir criticises Malaysia Airlines takeover/AFP

KUALA LUMPUR, August 12 – Influential former prime minister Mahathir Mohamad on Tuesday criticised the takeover of crisis-hit Malaysia Airlines by the country’s sovereign wealth fund as a recipe for more losses by the carrier.

Sovereign fund Khazanah Nasional, which has controlled the airline for years via a 70 percent ownership stake, said last Friday it plans to buy all remaining shares, de-list the stock, and take the carrier private before undertaking a “complete overhaul”.

The fund acted after the double tragedies of flights MH370 and MH17 pushed Malaysia Airlines (MAS) — which had already been losing money for years — to the financial brink.

“Khazanah has been in full control of Malaysia Airlines all this time. And all this time Malaysia Airlines has been bleeding profusely,” Mahathir, prime minister from 1981-2003, wrote on his blog.

“So why should anyone believe that with 100 percent control Khazanah will not keep on losing.”

Flight MH370 disappeared mysteriously in March with 239 people aboard, en route from Kuala Lumpur to Beijing. No trace has been found and the airline was widely criticised for its handling of the crisis.

On July 17, MH17 was shot down over war-torn eastern Ukraine, with another 298 people killed.

Mahathir suggested Khazanah may have difficulty re-negotiating contracts with politically connected supplier businesses that are unfavourable to MAS.

He added that the exercise will likely result in a new regime at MAS “receiving huge salaries, allowances and bonuses, and not much else.”

Some aviation experts have raised similar concerns that politics, cronyism and Khazanah’s own track record with MAS could prevent the aggressive action needed to resuscitate the carrier.

Advertisement. Scroll to continue reading.

Analysts said Khazanah needs to bring in a dynamic and entirely new management team, trim its 19,500 employees in the face of union resistance, and scrap major routes if MAS is to survive.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...