Business

Air France-KLM proposes buying 49% of Malaysia Airlines: Report

KUALA LUMPUR Proposals to invest in ailing Malaysia Airlines include one from Air France-KLM, which wants as much as 49 per cent while Japan Airlines (JAL) is looking at a 25 per cent stake, sources with knowledge of the matter said.

Domestic carrier AirAsia Group and Malindo Air, the Malaysian arm of Indonesia's Lion Air, have also submitted proposals, the sources said.

"The bids from the foreign carriers are more comprehensive and strategic as both plan to capitalise on the location of Malaysia for their operations," said one of the sources.

The Malaysian government has been seeking a strategic partner for its national airline, which has struggled to recover from two tragedies - the mysterious disappearance of flight MH370 and the shooting down of flight MH17 over eastern Ukraine.

In 2014, it was taken private by sovereign wealth fund Khazanah Nasional, which paid RM1.4 billion (S$464 million) for the 30 per cent of shares it did not already own.

Malaysian Prime Minister Mahathir Mohamad said on Monday that five proposals had been received as part of a review that started last year, but declined to name the suitors.

Malaysia Airlines last year signed a joint venture agreement with JAL covering flights between Malaysia and Japan, which the Japanese airline said could be expanded in the future to cover US flights.

Malaysia Airlines and JAL are both members of the oneworld airline alliance, while Air France-KLM is part of the rival SkyTeam alliance. - REUTERS

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