KUALA LUMPUR: The Securities Commission (SC) and Bursa Malaysia are investigating the swap deal between Khazanah Nasional Bhd and Tune Air Sdn Bhd in Malaysian Airline System Bhd (MAS) and AirAsia Bhd shares.
According to Bernama, Deputy Finance Minister Datuk Dr Awang Adek Hussin told the Dewan Rakyat yesterday that the probe would also look into the possibility of insider trading.
“It will take time because it involves many accounts and a huge value. We need to look into this matter thoroughly,” he said in reply to Wee Choo Keong (Ind-Wangsa Maju).
Wee had asked if the ministry had instructed the regulators to look into allegations of insider trading between MAS and AirAsia and failing to make relevant announcements prior to the swap deal.
The deputy minister stressed that if there is evidence of wrongdoing, the Malaysian Anti-Corruption Commission (MACC) could also be called in to investigate.
Under the swap deal announced in August, Tune Air and Khazanah, major shareholders of AirAsia and MAS, had agreed to swap their shares. After the swap, Tune Air now owns 20.5% equity interest in the national carrier, while Khazanah holds a 10% stake in the low-cost carrier.
The Employees Provident Fund is the common substantial shareholder of the two carriers. The EPF owns 10.2% of AirAsia and 10.44% of MAS.
Apart from the share swap, MAS and AirAsia had also entered into a comprehensive collaboration framework (CCF) to “establish a framework to explore the possibilities of mutual cooperation”.
Under the CCF between MAS, Khazanah has an option to acquire a 10% equity stake in AirAsia X.
AirAsia founder Tan Sri Tony Fernandes, who is also the carrier’s CEO, and deputy CEO Datuk Kamarudin Meranun are now non-independent and non executive directors of MAS.
The swap deal raised many eyebrows. At the time of the announcement in early August, AirAsia stock was trading near its record high of RM4.14 and MAS was near its 10-year trough of below RM1.50.
AirAsia’s share price was the star performer among the regional aviation stocks before the swap was announced. It climbed from RM2.50 in March to a record high of RM4.14 in late July.
MAS succumbed to heavy selling pressure following the announcement of its massive quarterly loss of RM242.3 million for 1QFY11 ended March 31, against a net profit of RM310 million in the previous corresponding period, on slightly lower revenue of RM3.19 billion.
AirAsia closed at RM3.78 yesterday and MAS ended at RM1.41.
This article appeared in The Edge Financial Daily, November 4, 2011.
According to Bernama, Deputy Finance Minister Datuk Dr Awang Adek Hussin told the Dewan Rakyat yesterday that the probe would also look into the possibility of insider trading.
“It will take time because it involves many accounts and a huge value. We need to look into this matter thoroughly,” he said in reply to Wee Choo Keong (Ind-Wangsa Maju).
Wee had asked if the ministry had instructed the regulators to look into allegations of insider trading between MAS and AirAsia and failing to make relevant announcements prior to the swap deal.
The deputy minister stressed that if there is evidence of wrongdoing, the Malaysian Anti-Corruption Commission (MACC) could also be called in to investigate.
Under the swap deal announced in August, Tune Air and Khazanah, major shareholders of AirAsia and MAS, had agreed to swap their shares. After the swap, Tune Air now owns 20.5% equity interest in the national carrier, while Khazanah holds a 10% stake in the low-cost carrier.
The SC and Bursa Malaysia are investigating the share swap deal between Khazanah Nasional Bhd and Tune Air Sdn Bhd in Malaysian Airlines System Bhd and AirAsia Bhd shares to see if there was insider trading, Deputy Finance Minister Datuk Dr Awang Adek Hussin to the Dewan Rakyat yesterday.
The Employees Provident Fund is the common substantial shareholder of the two carriers. The EPF owns 10.2% of AirAsia and 10.44% of MAS.
Apart from the share swap, MAS and AirAsia had also entered into a comprehensive collaboration framework (CCF) to “establish a framework to explore the possibilities of mutual cooperation”.
Under the CCF between MAS, Khazanah has an option to acquire a 10% equity stake in AirAsia X.
AirAsia founder Tan Sri Tony Fernandes, who is also the carrier’s CEO, and deputy CEO Datuk Kamarudin Meranun are now non-independent and non executive directors of MAS.
The swap deal raised many eyebrows. At the time of the announcement in early August, AirAsia stock was trading near its record high of RM4.14 and MAS was near its 10-year trough of below RM1.50.
AirAsia’s share price was the star performer among the regional aviation stocks before the swap was announced. It climbed from RM2.50 in March to a record high of RM4.14 in late July.
MAS succumbed to heavy selling pressure following the announcement of its massive quarterly loss of RM242.3 million for 1QFY11 ended March 31, against a net profit of RM310 million in the previous corresponding period, on slightly lower revenue of RM3.19 billion.
AirAsia closed at RM3.78 yesterday and MAS ended at RM1.41.
This article appeared in The Edge Financial Daily, November 4, 2011.
