KUALA LUMPUR: The Malaysian Aviation Commission has greenlit the proposed privatisation of Malaysia Airports Holdings Bhd (MAHB), determining that it will not substantially lessen competition (SLC) in the aviation sector.
In a consultation paper published on Oct 30, 2024 the aviation commission said its asessments found that the transaction will not substantially lessen compettition in the aerodrome relevant market; international and domestic passenger service markets; air cargo transportation services market; and ground handling services market.
It has invited submissions for written feedback on the proposed decision by email by 5.00 pm on Nov 6, 2024.
The proposed transaction by Gateway Development Alliance Sdn Bhd, Pantai Panorama Sdn Bhd, Kwasa Aktif Sdn Bhd, and GIP Aurea Pte Ltd (applicants) falls within the scope of the Malaysian Aviation Commission Act 2015 [Act 771].
"A merger that has resulted or may be expected to result in an SLC in any aviation service market may be allowed by way of an exclusion if there are significant economic efficiencies or social benefits arising directly from the merger that outweigh such SLC," Mavcom said in its proposed decision.
It added that while it had received feedback regarding the rationale for proposed transaction to achieve the significant economic efficiencies and social benefits, the applicant could not further substantiate their claimed economic efficiencies and social benefits, by providing the business case and all relevant analysis conducted by the applicants on MAHB's operations.
"The Commission had also requested that the applicants provide documentary evidence to substantiate any of the priority initiatives that they had already committed to undertake," Mavcom said.
This was also not fulfilled.
Mavcom's proposed decision also comes after receiving feedback from industry players and the public between Aug 9 to 23 following the publication of a summary application by the applicants on its website.
The applicants plan to collectively acquire all the remaining 1,118,098,325 shares not already held by the consortium, and which represent 67.01 per cent of MAHB.
Mavcom said the proposed decision is subject to the applicants entering into a finalised, valid, and binding shareholders' Agreement, which contains their key obligations in the shareholders' agreement term sheet dated May 15, 2024 and the second draft shareholders' agreement received by the commission on Oct 24, 2024.
This ensures that, post-merger, the applicants will not engage in commercial activities relating to aviation services that infringe the prohibitions under Act 771.
The proposed decision remains valid for a year, effective from the date on which it is made final.
In May, 2024 MAHB has received a takeover offer from a four-member consortium led by its major shareholder Khazanah, in a deal worth about RM10.8 billion.
Khazanah, along with the EPF, New York-based Global Infrastructure Partners (GIP) and Abu Dhabi Investment Authority (ADIA) are jointly offering RM11.00 per share to buy all of the remaining shares in MAHB not already owned by them.
MAHB's share price was up 10 sen to close at RM10.56 a share, at midday break.