Malaysia's AirAsia secures $72 million loan from Sabah Development Bank
Reuters
October 23, 2020 20:09 MYT
October 23, 2020 20:09 MYT
AirAsia has been looking to raise as much as 2.5 billion ringgit by the end of the year. BERNAMApic
KUALA LUMPUR: Malaysia's AirAsia Group Bhd has approved and disbursed a 300 million ringgit ($72 million) loan from Sabah Development Bank Berhad to its units as part of the group's fundraising efforts, the budget airline said in a bourse filing on Friday.
The airline said the loan was not backed by a government guarantee, which the group has been seeking for a portion of the loans it hopes to secure.
AirAsia has been looking to raise as much as 2.5 billion ringgit by the end of the year, 1.5 billion ringgit of which could be in bank loans.
AirAsia said the loan was to fund specific development projects as agreed by the airline and the bank, including 170 million ringgit to establish and operate a digital food supply chain and cold chain facilities in the state of Sabah.
The rest will part-finance a project to turn the capital city airport into an international hub for AirAsia's operations, enhance e-commerce platforms and marketability of Sabah products and promote tourism destinations on AirAsia's platform.
"The main purpose of the loan is to enhance logistics in Sabah by increasing its supply chain and connectivity, creating over 100,000 new jobs in the process," it said.