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Product cover image for AirAsia X: Financial Distress and Debt-Restructuring Negotiations

AirAsia X: Financial Distress and Debt-Restructuring Negotiations

Emir Hrnjic, Elsa Satkunasingam

Product #:W41383
Supplier:Ivey/NUS
Discipline:Finance, General Management
Setting:Malaysia, 2020
Details:Case (PDF) • 17 pages • 2025-04-09

Subjects:

Financial restructuringDebt managementBankruptcyLeadership and managing peopleFinance and investingManagement

Industries:

Transportation and distribution

Geography:

MalaysiaAsia
Your Price:$9.71

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AirAsia X Berhad (AAX), a long-haul, low-cost airline based in Malaysia, faced a difficult financial situation in October 2021. As the global COVID-19 pandemic had forced the Malaysian government to impose travel restrictions and close its borders in 2020, the majority of AAX’s fleet had been grounded. By 2021, AAX’s total liabilities outweighed its total assets by RM33.581 billion. Unable to service the lease payments to lessors, AAX designated Lim Kian Onn to lead the company’s restructuring. Lim needed to determine how to carry out the corporate-restructuring exercise, the creditors’ tolerance for such an exercise, and what terms to propose to creditors.

Learning Objectives

This case is designed for undergraduate- and graduate-level courses in corporate finance, financial statement analysis, and corporate governance. By working through the case and assignment questions, students will have the opportunity to do the following:
  • Assess the complexities related to a corporate restructuring.
  • Assess the complexities related to capital raising via rights offer.
  • Critically review a debt-restructuring exercise.
  • Evaluate and design negotiations with creditors.
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Case Study: AirAsia X: Financial Distress and Debt-Restructuring Negotiations (English version) | Ivey Publishing