01/06/2026

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MONDAY | JUNE 1, 2026

Capital A – restructured, reset and ready to soar again o Group emerges from turbulence with AirAsia ecosystem transformed into two distinct businesses – aviation and non-aviation – and separate roles and growth drivers

Ű BY HAYATUN RAZAK sunbiz@thesundaily.com

PETALING JAYA: Six years after the Covid-19 pandemic grounded AirAsia’s fleet and pushed its parent into financial distress, Capital A Bhd is emerging from one of the most turbulent periods in its history with a fundamentally restructured busi ness, one that is no longer centred solely on aviation. The group’s exit from Practice Note 17 (PN17) status on May 20 closes a turbulent chapter and caps a multi-year restructuring that has transformed the AirAsia ecosystem into two distinct businesses with separate roles and growth drivers. The reorganisation centres on a clean separation of aviation and non aviation operations. AirAsia X Bhd, which has assumed control of the group’s airline business and is proposing to rename itself AirAsia Group Bhd, now operates as a pure-play aviation vehicle focused on fleet expansion and network growth. Capital A, in contrast, houses a portfolio of businesses spanning aviation services, logistics, travel, brand monetisation and food and beverage. “The carefully structured and executed restructuring allowed us to create greater clarity for investors by separating two distinct businesses with very different growth drivers,” Capital A CEO Tan Sri Tony Fernandes told SunBiz . He stressed that the move was never about stepping away from aviation, but rather an evolution of the ecosystem built around AirAsia over more than two decades. “This was never about moving away from aviation. In fact, all of Capital A’s businesses were built from opportunities created by the AirAsia ecosystem over the last two and a half decades,” he said. “What has changed is that these businesses have now matured into strong standalone companies with their own customers, revenue streams and growth trajectories.” Fernandes said all of Capital A’s current businesses were born out of the AirAsia ecosystem, but each has since developed into a standalone operation. Asia Digital Engineering (ADE), once an internal maintenance unit, now serves airlines globally, while

scoring the need for a more balanced business model anchored by mul tiple growth engines. “While aviation is naturally more exposed to fuel price volatility and geopolitical developments, Capital A’s businesses have remained resilient and in some cases continue to benefit from strong demand,” Fernandes said. “That diversification gives us a stronger foundation for long-term growth while allowing each business to pursue opportunities far beyond the AirAsia ecosystem.” Looking ahead, Fernandes identi fied ADE and Teleport as the group’s most promising long-term growth drivers, underpinned by structural demand trends in both sectors. “Every business within Capital A has a clear growth runway, but ADE and Teleport are particularly exciting because they are operating in sectors where demand continues to outpace supply.” He said ADE, the group’s main tenance, repair and overhaul arm, is positioned to benefit from a global shortage of aircraft maintenance capacity as aviation activity con tinues to recover. “Malaysia’s strategic location as a regional aviation hub, combined with ADE’s expanding capabilities across aircraft maintenance, com ponents, digitalisation and AI-driven predictive maintenance, provides a strong platform for growth beyond servicing AirAsia’s fleet.” The business has already made inroads into the third-party segment, serving a growing list of international customers, including globally recog nised carriers such as Air France. “The line maintenance network now spans 20 airports across Asean, supported by base maintenance

“Perlis’ strategic location along the Malaysia-Thailand border gives the state a significant advantage in emerging as a major logistics and trade hub in the region. PIP has the potential to become a key land trade gateway linking Asean countries with broader markets in East Asia and Eurasia,” he said at the opening ceremony of the Tuanku Syed Sirajuddin Free Commercial Zone at PIP on Saturday, officiated by the Raja of Perlis, Tuanku Syed Sirajuddin Jamalullail. Also present were Raja Muda of Perlis, Tuanku Syed Faizuddin Putra Jamalullail and Perlis Menteri Besar Abu Bakar Hamzah. Teleport has grown from utilising cargo belly space into a regional logistics network across Asia. AirAsia MOVE has evolved into a regional travel platform, and AirAsia Next is unlocking value through brand licensing, loyalty programmes, artificial intelligence and data. Santan, originally an inflight food offering, is expanding into a stand alone consumer food and beverage brand. Together, these businesses now operate with their own customer bases, revenue streams and growth trajectories, which Fernandes believes will enable them to scale beyond the AirAsia ecosystem. He was unequivocal when asked whether Capital A today differs from its pre-pandemic structure. “Yes. Capital A today is funda mentally different from the pre pandemic AirAsia ecosystem,” he said. While aviation remains central to its heritage, Fernandes said, the group is extending its brand into travel, logistics, hospitality, food, loyalty and other lifestyle segments. “AirAsia is no longer just an airline. It represents a philosophy of accessibility, value, innovation and inclusivity that can resonate across multiple industries and touch more aspects of everyday life.” Fernandes said the rationale for diversification has become more compelling in the current global environment, where recurring geo political tensions, fuel price volatility and uneven travel demand continue to expose the structural risks of relying heavily on aviation. He pointed to the Middle East conflict as a timely example of how external shocks can disrupt airline operations and profitability, under

Fernandes (right) and deputy CEO Effendy Shahul Hamid.

capacity of up to 16 lines, alongside specialised workshops across multiple locations,” Fernandes said. Last week, ADE secured a US$100 million (RM396 million) financing facility from QNB Group to support its expansion and capacity growth. The funding will be used to invest in additional infrastructure and meet rising demand for maintenance services across the region. Teleport, meanwhile, reflects the group’s long-term bet on e-com merce-driven air logistics. Having

established itself as a market leader in Malaysia and Southeast Asia within eight years, the business is now positioning itself for global expansion. “Teleport is ready for global growth. Teleport made an early bet to be an e-commerce-first air logistics player and has established itself as a

market leader in Malaysia and Southeast Asia after only eight years in operation and aims for the top 10 globally next,” Fernandes said.

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Loke: Perlis Inland Port to contribute to US$30b M’sia-Thailand trade target PADANG BESAR: The government is confident that the development of the Perlis Inland Port (PIP) will contribute significantly towards achieving the Malaysia-Thailand trade target, which is projected to reach US$30 billion (RM119 billion) by next year. Loke said the PIP is expected to catalyse local economic growth through the creation of new jobs, increased business activity and the inflow of high-quality investments into Perlis. He said the facility would also complement other strategic system, the facility will provide wider access to markets across Asean China, Central Asia and Europe through the Trans-Asian Railway network. “This development is expected to reduce dependence on a single transportation route, improve logistics efficiency and lower trade operating costs,” he said. maximum operational capacity of 150,000 twenty-foot equivalent units (TEU) per year.

“With an area spanning 202.34 hectares and its comprehensive modern logistics facilities, the PIP offers an initial handling capacity of 600,000 TEU per year and has the potential to expand to two million TEU once completed.” Loke said PIP would serve as a strategic platform to expand Malaysia’s trade network with countries in the Mekong region, China and Central Asia, strengthening the country’s position as a preferred trade and logistics hub in the region. – Bernama

developments under the Northern Corridor Economic Region, including Chuping Valley Industrial Area, Kedah Rubber City and Kedah Science and Technology Park, creating a com petitive and mutually reinforcing economic ecosystem. “Through its direct connection with Malaysia’s double-track rail network and Thailand’s railway

Transport Minister Anthony Loke said the close ties between Malaysia and Thailand have long been the foundation of economic develop ment in the border areas of both countries, and the PIP would strengthen these economic relations through more efficient, faster and integrated cross-border trade facilitation.

At the same time, using the railway as a main cargo transport mode also supports the nation’s aspiration of a greener and more sustainable transport system by reducing carbon emissions and traffic congestion, said Loke. “The facility is developed to replace the Padang Besar Cargo Terminal, which has reached its