Saudi Arabia’s Public Investment Fund (PIF) plans to invest $100 million in Malaysia’s AirAsia, sources reveal, boosting Gulf tourism ties. This move aligns with the Kingdom’s efforts to deepen partnerships in Asia, a key tourism market.
PIF will lead AirAsia’s 226 million fundraising effort, according to a report from Bloomberg, revealing that the airline also negotiates with other investors.
An announcement may come within weeks, but the report claims that the deal remains uncertain and could collapse. Final terms hinge on regulatory approvals and investor consensus.
Reviving Growth Post-Pandemic
AirAsia seeks funds to recover from pandemic losses. Talks include investors from Singapore and Japan. The airline’s parent firm, Capital A, faces financial distress and abandoned a US listing last year.
AirAsia’s backlog of 350 Airbus narrowbody jets attracted PIF’s interest. Recently, Riyadh Air—a PIF-owned startup—acquired some Airbus delivery slots, easing AirAsia’s near-term financial commitments.
Riyadh Air initially planned to purchase 100 Boeing 737 jets. It later shifted focus to AirAsia’s Airbus slots, sources noted. The swap accelerates Riyadh Air’s 2024 launch amid tight aircraft supply.
PIF’s Expanding Aviation Portfolio: From Leasing to Heathrow Stake
PIF’s aviation assets include aircraft leasing, defense firms, and a 15% stake in London’s Heathrow Airport. The $930 billion fund also supports Saudi Arabia’s goal to become a global travel hub.
Crown Prince Mohammed Bin Salman champions projects like Neom, a $1.5 trillion futuristic city, and global sports investments. Aviation expansion remains central to diversifying beyond oil.
Capital A, AirAsia’s parent, faces financial strain post-pandemic. A failed 2023 U.S. listing stalled growth plans. New investors could revive its order for 100 regional jets from Airbus or Embraer.
