KINIBIZ Khazanah Nasional announced a RM6 billion plan to rescue ailing Malaysia Airlines aimed at returning it to profit within three years or by 2017. The 12-point plan will involve the formation of a new company (newco) to take over the assets and business of the old company (oldco) and a 30 percent or 6,000 jobs cut.

If and when the airline becomes profitable, then the airline may be relisted, which would be within five years of delisting.

Announcing the plan today, Khazanah managing director Azman Mokhtar ( left ) said that other key moves involve the passing of a MAS Act to facilitate staff transfer and to terminate or review contracts which are unfair to the airline.

The Act is to ensure that decisions cannot be taken to court and is analogous to legislative protection accorded to Japan Airlines and Chapter 11 protection given to US companies which are facing bankruptcy and liquidation.

It will also ensure that Malaysia Airlines will get to decide the staff that it wants to keep and let go of other staff through redundancy packages. There will also be new terms and conditions of service.

There are not likely to be haircuts as most of Malaysia Airlines debt is owed to the government while Retirement Fund Inc's (KWAP) RM750 million sukuk facility will be converted to equity as part of the rescue plan.

Azman said that going by current trends the airline’s losses for the full year could come up to as high as RM2 billion of which about half can be attributed to the bad effects of the two tragedies involving MH370 in March  and MH17 last month.

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