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Thursday July 12, 10:40 AM
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Malaysia's AirAsia has no interest in Virgin stake
By Clarence Fernandez
KUALA LUMPUR (Reuters) - Malaysia's AirAsia Bhd, Southeast Asia's biggest low-cost airline, has no interest in seeking a stake in Virgin Atlantic, founder Tony Fernandes said on Thursday.
The comment follows news this week that Singapore Airlines, the world's biggest airline by market value, was considering selling a stake of 49 percent in Virgin Atlantic that it bought in 1999 for 600 million pounds ($1.2 billion).
"No, not our scene," Fernandes said in an e-mailed response to Reuters when asked if AirAsia would consider taking a stake in Virgin Atlantic.
Market speculation frequently links Fernandes, a former Virgin executive who worked at the company as a financial controller for two years, with group founder Richard Branson.
Last month, Fernandes was reported to be in talks with Virgin to sell a stake of 20 percent in his long-haul budget airline, AirAsia X, but he has declined to comment on the situation, although not ruling it out completely.
"I can imagine that whether it's AirAsia or Fly Asian Xpress, eventually he could be eyeing some kind of equity swap with Virgin, but that's still a long way off, I think," said an aviation analyst with a local brokerage, who asked not to be named.
Fernandes, who controls AirAsia X through operating company Fly Asian Xpress, has said it will start flying out of the Malaysian capital in September, primarily to Japan, South Korea, China, India, Australia and the Middle East.
Branson said this week he would consider buying back the Singapore Airlines stake after Britain's Daily Telegraph reported the carrier was considering a sale.
Shares of AirAsia were up 1 percent at 1.9 ringgit by 0224 GMT.
Fernandes has said AirAsia X would build a fleet of 25 planes to be delivered between the fourth quarter of 2008 and 2011, and fly a total of 7.5-8 million passengers over the next five years.
Until then, AirAsia X plans to lease planes.
Fly Asian Xpress is owned by its CEO Raja Mohamad Azmi, Fernandes and AirAsia Deputy Group Chief Executive Kamarudin Meranun. It currently serves Malaysia's eastern states of Sabah and Sarawak on the island of Borneo.
Last month, Fly Asian Xpress ordered 15 long-haul Airbus A330 aircraft powered by Rolls-Royce engines in a deal worth $2.9 billion that included options for an additional 10 aircraft.
