August 11, 2011
Sting is in a Air?
by Sakmongkol AK47
We will let a trainer of Khazanah (Azman Mokhtar) contend anything he wants during a moment as well as have his 5 mins of fame. At leas, we have been spared his brand brand new found religiosity. Everyone would be forgiven to think which this is a final word upon a issue since a trainer of Khazanah says a whatever we called it of a understanding in between MAS-AirAsia, it is defensible. Among alternative things he says, this is not a bailout of MAS.
We will take him upon these issues. The initial question we instruct to ask, since is this understanding worked out in a initial place? Why AA? It is handling during how many times a PE? 40 times? Looking during a numbers as well as a fundamentals, a tall PE could meant a stocks have been overpriced. That equates to some boys could be in progress up a numbers to set up a marketplace as well as have killings. Maybe.
If a reason as Dr Mahathir says, MAS can sense from AirAsia upon ways to cut costs, we meant a damn practice carried out by Idris al Dunlap Jala wasnt enough? Why dont we sense from Singapore Airlines or Qatar Airlines? Oh we instruct to sense from a home grown bent will be a expected answer.
I know this is a BAD understanding since Dr Mahathir said so. Dr Mahathir always contend something when he essentially meant a reverse. What can we sense from AA? How about a home grown talents jot down then? As of a 1st Quarter of 2011, AirAsia (AA) debts amounted to RM7.7 billion with money balances amounting to RM1.7billion. This partial doesnt require teaching for MAS. Its executives have been renowned masters.
In Aug 2010, AA announced a deferment of their due aircraft purchases though sometime in Jun 2011 they topsy-turvy their preference as well as proceeded to place an order for an a single more 200 brand brand new aircrafts during a Paris Air Show. No large deal, we can order as many as we want. Possibly a co! mmission s warranted from a purchases dwarf a the single warranted from a Scorpene submarines which have been not submersible.
As of! 31 Marc h 2011, as we can see from a 1st Quarter report, AAs capital commitments stood during RM nineteen billion. With a upon top of announcement, an a single more RM54 billion will be combined as Capital Commitments. The due Capital Commitments of rounded off RM74 billion will be spread over a fifteen year duration finale 2026.
In alternative words, AA has to enlarge a earnings to an normal of RM 5 billion per annum to encounter a future dues. From 2006 to 2010, AAs income grew by 10 fold from RM110 million to rounded off RM1.1billion, an normal growth of RM 200 million per annum. How will it reach RM5 billion? We will see in a entrance months when they justify all a routes as well as what not.
Its money pot rose 6 fold from we estimate RM 300 million to 1.7 billion though a debts skyrocketed from RM1.05 billion in 2006 to RM .7 billion in 2010, an enlarge of 700%.Surely this looks like a debt burden which is spiraling out of control. But spend baby spend.
This understanding is signed, hermetic as well as delivered during an onerous as well as meaningful time. The world manage to buy together with Asias will be in to an additional maelstrom as well as air travel will invariably be hit. So what can be done?
One, AA can cancel orders though stipulate penalties will be onerous. Air Middle East wouldnt instruct to compensate penalties would it? The debt with MAB too ist dragged upon what seems to be forever. That choice is no go as well as since does any a single instruct to forfeit commissions. Also, Tony (Fernandes) is probably thinking along what Keynes said- when we have been a large borrower, a banks have been scared of you. So as a large borrower Tony feels which distance does matterafter all- it will defense him from foreclosure as banks will be leery of temperament heavy losses!
But also, a sizeable cube of those l! oans hav e been being hold by Malaysian banks as well as in a misfortune case scenario, a supervision as well as a taxpayer will have to collect a tab to avert a monetary meltdown cascading down a AA slope. So may be what a blogger said about enriching AA upon taxpayers money is true after all.
Let me sp! eak to s ome monetary whiz kids to see a understanding from a opposite perspective. No, we am not starting to dignify a single commentator with an answer saying which we am a racist for writing this article. If it were which a Meranun guy inking this deal, we will belt him a same. Who cares what race Tony is? You meant we cannot impugn dear Tony since he is of a opposite race as well as if we do, it amounts to racism?
Take a demeanour during MAS, a whipping boy presently though which is instrumental to further a diversion being played by Azman Mokhtar as well as his cohorts. MAS has a paid up of RM 3.384 billion as well as has bound item valued during RM 8.4 billion. Its net item is RM6.962 billion, of which RM 2.086 billion is cash.
Compare which to a in front of of Air Middle East which has borrowings up to RM 7.7 billion as well as a money of RM 1.7 billion. AirAsia has a jot down of being a bad debtor; it once due Malaysia Airports Berhad over RM 65 million as well as during your convenience action was being contemplated opposite them, they run to their arch counsel, afterwards Prime Minister Abullah Badawi. Now, of march AA has Tun Dr. Mahathir upon a side as well as a disintegrating as well as aggressive Chairperson Rafidah Aziz who can be counted to be a enforcer upon a other.
Malaysia Airlines wealth is essentially a network as well as in front of in a Tier-5 airline market. Malaysia Airlines annual handling turnover is RM12.98 billion contra Air Asias RM 3.948 billion. MASs handling income from airline operations is during RM RM 11.649 billion opposite Air Asias RM 2.839 billion.
This is whatever we instruct to call it- merger, cooperation, or partnersh! ip is a mystery shrouded takeover with a elements of manipulation as well as disaster of disclosure. What is function to a in front of of minority shareholders?
Khazanah is giving away 20.5% of a holding in a association which had a bigger network, acclaimed higher customary of service, much bigger handling revenue, stronger assets, obtuse debts, more money as well as improved paymaster lane jot down to an additional association with obtuse lane ! record, though a single which excels in hyped up marketing as well as display it can have a lot net money in shorter time.
Also, we find it bizarre to see a single businessman bank behaving as usual adviser to this deal. Then we remembered a benefaction capo dei capi of Khazanah is cheese compared to marker of an additional progressing Khazanah boss.
Courtesy of Bonology.com Politically Incorrect Buzz & Buzz
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