Tune Air Takes Over AirAsia, Malaysia`s Second National Carrier

Following the signing of the Sales and Purchase agreement on September 6th all approvals and due diligence has been completed, and today, Tune Air Sdn Bhd officially acquires the 99.25 per cent equity DRB-Hicom has in AirAsia, which amounts to 51.68 million shares. With this takeover, AirAsia will still be the operating company whilst Tune Air remains the holding company.
Tune Air aims to remodel AirAsia after successful low fare airlines such as U.S.-based Southwest Airlines and Dublin-based Ryanair and create a new aviation product in Malaysia.

Confident that Malaysians will respond, AirAsia recently experimented with its first low fare campaign by offering a 2000 seat sale in December. One-way fare to Langkawi is priced at RM123 and so far, the telephones at the AirAsia call centres have not stopped ringing. AirAsia promises that the low fare offers will continue and that passengers should keep an eye on AirAsia to keep themselves aware of the future offers. Tune Air CEO, Tony Fernandes, firmly believes that now everyone can fly.

Tune Air will expand AirAsia`s existing fleet of two to five planes by June 2002. The Boeing 737-300`s will be one of the newest fleets operated in Asia at an average age of 6 years. AirAsia has currently applied to the Ministry of Transport for more routes. AirAsia will be rolling out its route strategy over the next few months. Existing destinations include Kota Kinabalu, Langkawi, Kuching, and Labuan. Following that, new routes will be Penang, Kota Baru, Johor Bahru, Miri, Alor Setar and Kuala Terengganu.

AirAsia`s main objective is to get more Malaysians flying. AC Nielson reports that only 602,000 Malaysians have flown at least once over the last 12 months. This accounts for only 6 per cent of the adult population. The combination of low fares and good destinations is a good way to introduce more Malaysians into using air transport. This is exactly what is required to encourage local tourism and to stimulate the national economy. AirAsia`s low fares are designed to target to the main bulk of Malaysians who have never flown and not to compete with other air carriers.

The board of Tune Air includes YBhg. Dato` Pahamin A. Rajab, Aziz Bakar and Kamarudin Meranun. Ryanair`s former director of operations, Connor McCarthy, will serve as advisor to Tony Fernandes.

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YBhg. Dato` Pahamin A. Rajab was quoted as follows, “In all my years in the Ministry of Transport, I felt that there was a need for a low cost airline. I am proud to be a part of the team that brings this concept to Malaysia There was attractive road and rail transport but air travel was beyond the average Malaysian. This is a new product that will be efficient, egalitarian and attractive”.
We will make flying attractive, and we will stick to our tagline `NOW EVERYONE CAN FLY`
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