The main shareholders of Asia Aviation Plc (AAV), Thai AirAsia CEO Tassapon Bijleveld as well as members of his family sold their majority stakes to duty-free operator King Power. The transaction was reported last Monday to the Stock Exchange of Thailand and represented a deal worth THB7.9 billion (US$225 million). Asia Aviation Plc is the holding which owns 55% of Thai AirAsia.
Following the deal, Tassapon Bijleveld will still own 5% of AAV shares while Vichai Srivaddhanaprabha, Chairman of King Power and his two sons will from now own 38.9% of the shares of AAV. The remaining 45% are still in the hands of AirAsia in Malaysia. “I have always been interested in aviation businesses. We used to have 5% in Nok Air when it was launched but the stake was too small to make a difference,” said Mr Vichai, founder and chairman of King Power International Group, the operator of the country’s only duty-free store chain.
While the board of directors will see the replacement of three directors by three new directors selected by Mr. Srivaddhanaprabha -including King Power chairman’s two sons-, what could be the consequence for Thai AirAsia?
Tassapon Bijleveld and his team have so far been confirmed at the head of the airline but new synergies will be explored with the King Power Group. TAA will likely accelerate its expansion towards China, a major market for King Power duty free business. “The synergy with Thai AirAsia will support King Power’s core business, especially in China, the major market of both companies. Thai AirAsia will add new routes in China and bring tourists to shop at King Power,” explained Vichai Srivaddhanaprabha during a press briefing. King Power plans now to expand its distribution channel, particularly on board of TAA aircraft.
Commenting on the shares sale, Tassapon Bijleveld declared that “the same team of executives and I will continue to manage the airline. We remain committed to growth just as we did when we launched the airline 13 years ago. We will continue to grow and invest as planned for in 2016 with an estimated number of 17 million passengers,” he said.
Last year, Thai Air Asia carried 14.8 million passengers and made $30-million net profit.