27 Nov 2000 THE BUSINESS TIMES
online edition
Mahathir
says RM8 a good price for buying 29% MAS stake
Govt
negotiating with Tajudin Ramli; stock closes at RM3.22 on Friday
MALAYSIA'S
Prime Minister Mohamad Mahathir has said that RM8 "could be a good price" per
share for buying a 29 per cent stake of national carrier Malaysian Airline Systems Bhd,
although the government is still negotiating the price.
The Malaysian
government has approved plans to buy the stake from Naluri Bhd, a company controlled by
businessman Tajudin Ramli. The sticking point is the share price, with Mr Tajudin asking
for as much RM1.79 billion (S$828 million), the Asian Wall Street Journal reported on
Friday, citing anonymous sources familiar with the plan.
Investors are
watching for signs the government may bail out another tycoon battling dwindling assets
and swelling debt after the country's recession in 1998. The airline's shares closed on
Friday at RM3.22, less than half the RM8 Mr Tajudin paid per share in 1994.
Malaysian
Airline has posted losses for three consecutive years through March 2000. The government
is counting on a foreign shareholder to boost the airline's competitiveness at a time
when air travel in the region is increasing.
Dr Mahathir said Malaysian
Airline can't avoid the global trend of forming alliances with other airline companies.
"All
we have done so far is to say that we will study the possibility, selling shares or
cooperating in some kind of joint cooperation with others," Dr Mahathir told
reporters in Singapore on Saturday.
SAirGroup's Swissair, Europe's
fifth-largest airline, Qantas Airways Ltd, Australia's biggest carrier, and KLM Royal
Dutch Airlines NV have been named as potential buyers of a stake in the carrier.
"We
are open. There are lots of people who have become suitors," Dr Mahathir said.
"At the moment, MAS is not yet satisfied with the suitors and is maybe looking at
other things as well."
Naluri, which is 47 per cent owned by Mr
Tajudin, has RM1 billion of debt. -- Bloomberg
