Showing posts with label Tony Fernandez. Show all posts
Showing posts with label Tony Fernandez. Show all posts

Friday, March 16, 2012

Najib, Close Down MAS And F.O The Union.

Hantu Laut

I still remember the day Lee Kuan Yew threatened to close down SIA.That was in 1980 when I still lived in Singapore.

Lee's fiery speech telling the Singapore Airlines' Pilot Association, in no uncertain term, what he intends to do if they continue with their 'work to rule' action that have disrupted several of the airline flight's schedule.The pilots were asking for higher salaries and greater benefits.


At that time SIA had many expatriate pilots.



Lee personally confronted the pilot and told them he would close down the airline, sack all of them, if he had to, and start a new airline.


As a consequent, the association was de-registered and its officials prosecuted and SIA continued to soar into the blue yonder.

Lee has shown how tough he can get when facing a threat.This is what true leader should do when confronted with threat from a small group of people, too selfish to care about the nation's interests.



The great Mr. Lee taking on the Americans.

In 2004, Lee, this time not as PM, but as minister mentor had head-on collision with the SIA pilot union again.Taking up a personal charge to clean up the problem posed by the SIA pilot union Lee warned of "cracking head" if the pilot union moved toward a strike.His concern is two of Singapore's biggest assets, SIA and Changi Airport, which is already facing severe challenges from budget airlines and long-haul air crafts which could bypass Singapore as stopover point.


As they say 'the rest is history' and without me saying, you should know who  the winner was?

I must say, I am disappointed with Prime Minister Najib Tun Razak.He succumbed to too many demands made by the oppositions, his own party belligerents and now he seemed to have succumbed to the MAS employees union and the root of the matter is not even over wages and benefits for the union workers but about who can buy into MAS and who can't.



The union is now interfering in the business and management of the company.

Obviously, Najib is listening to the wrong people advising him how to deal with MAS woes.

MAS massive losses of MR2.5 billion incurred last years has nothing to do with the share swap.The share swap was done in August 2011 which is slightly over six months now.


Any nincompoop would know there are gestation periods involved before the company can show profitability. To say MAS is at the losing end of the deal is preposterous.If you replaced one shitty management with another one of the same standing should you expect any better?

Like the carpenter who blame the tools for his shoddy work, MAS management keep harping on increased cost of fuel as the gremlin of their problem. 


What about SIA and other profitable airlines, are their planes running on water? What about Air Asia, the cheapo airline, how the hell they can show profits for the same period? Maybe, their planes are running on sugarcane juice?

It's a shame that this bunch of Malay technocrats never seemed to get their act together, more attune to playing the blame game than getting down to serious work of saving the airline.

Instead of looking into cost cutting, redundancy, retrenchment and boosting sales, they found a new rat on board that may be cutting the ground under their feet.


The rat is no other than Tony Fernandez, whom they see as a threat.

It was reported that officials of MAS union went to see the PM to state their displeasure and opposition to the share swap with Air Asia.The PM should have showed them the door and tell them it is not their business to tell him how to run the government, their business is to look after the welfare of their members.If MAS goes down, they all be out of a job, anyway.

Would 20000 MAS employees scare him into breaching the MAS/Air Asia tie-up? Would a new government entity taking over the airline makes it profitable? I cast my doubt.

Quote
(The Malaysian Insider has learnt that Putrajaya officials are working on a plan for Khazanah to divest its stake in MAS first before a general offer is made for the remaining shares from other shareholders, including tycoon Tan Sri Tony Fernandes’ Tune Air, which owns a 20.5 per cent stake in the national airline. In the August 2011 deal, Khazanah got a 10 per cent stake in Asia’s biggest budget carrier AirAsia.) Unquote.

Food for thought!What happened if Tony Fernandez refused to sell after the restructuring. What you do? Shoot him,ISA him or sent him to Ceylon?

Najib should make business decision, not political decision.He should not entertain the MAS union's demand.It absurd that 20000 MAS employees can save his premiership and he sacrificing more taxpayer's money to appease them.

Najib is moving in the right direction but he must show that he is control, he is the boss, not swayed by people who are harbingers of doom.

Quote (
Failing to placate the union could turn into a political hot potato for Najib as MAS operations are centred in Selangor, an important industrial state Najib wants to wrest back from the opposition in elections that could be held within months. MI) Unquote.

Close down the damned airline and F.O the MAS union.It's the people money that's going down the drain.

Alternatively, sell MAS to Tony Fernandez for a song.

Tuesday, November 15, 2011

Doggoned MP Bung Mokhtar, MAS Is Not Worth Crying For


Hantu Laut

Does he know anything about doing business? 

Can he interpret a "Balance Sheet" or read and make sense of "P&L" account statement, or understand what "PE" ratio is, or what is meant when a company is "highly geared" ? Has he any idea what is quick ratio/acid test or what are the negative aspects of "LBO" and what "insider trading" are?

I am sure this kampong bully who made it to the august house do not understand the intricacies of the corporate world.
Just because some smart sounding alecs and clueless opposition leaders and equally clueless bloggers criticised the share swap between the two companies, politically motivated and out of envy rather than concerned for financial probity. 

Envy, because that Indian(Sri Lankan, if you wish, a good Ceylonese friend of mine refused to be called Indian, preferring to be called Jaffnese, which he thinks is more exotic) wiz-kid can do what they can't even dream of, let alone doing it. 

Bung Mokhtar's grandstanding here.

Tony Fernandez is an icon of corporate Malaysia, a true entrepreneur, rag to riches story that one should emulate and be proud of. He has done more for this country than some of the asses in our august house.

From opposition leaders with politically motivated agenda, the dickhead leaders of MAS Union, to this hillbilly from Sabah, I suggest you know your subject first before you open your big mouth. MAS is a public listed company, anyone can buy into it.

Business is not run on emotion or sentiment, it's fuelled by money, the more the merrier.

Get it into your thick head, MAS is a very sick company, a cash guzzling monster ran by incompetent people. 

When it was wholly owned by the government the accounts were never published publicly, so we have no way to gauge its performance then, keeping the people in the dark and it was taxpayer's money that kept it going.

We only come to know the state of its health and the incompetence of its management after it went public. The government should wash its hand off this sick baby, either privatise the airline or close it down and let free enterprise takes over the airline business in this country.

Air Asia has done more for air travel in this country than MAS ever did.It has made air travel affordable to the poor and low income group.

Unfortunately, MAS has still not woken up to its mistakes, the management is still fast asleep and they still have the highest fare among airlines in this region.They are only interested in winning stupid awards like "finest 1st class cabin service" and so forth.

While other airlines reduced fares to get bigger business volume, MAS is only interested in maintaining its "haute couture" image, which it can hardly afford.The only way it can survive is to sack half the workforce. Tony Fernandez and the new board should do just that.

To give you an idea on how incompetent those running the airline, I would like to show some online fares of various airlines from Kuala Lumpur to London.

I booked for my family of 4 adults and 2 children lowest fare of no less a premier and much superior airline than MAS on exactly the same dates.The difference is shocking.

MAS fares are an airline death wish.

Below are fare comparisons:
Adults 4, children 2. (London/KL Return)

MAS:MYR62,990

SIA:MYR22,934

EMIRATES:MYR27,264

ETIHAD:MYR26,984

KLM:MYR23,814

All are full-frills airlines. SIA is using Airbus A380 and MAS using its ageing B747 -200 and 400.

Those who think so great of MAS better think again.Just look at the prices. 

All the other airlines fares are pretty close, which means, they understand competition, while MAS is still sitting on its laurel waiting for Santa Claus to save the airline.

Tony Fernandez has a track record of turning a loss making 2-plane airline formerly owned by the government, which he bought for a song and a huge debt and turned it into the pride of the nation. The biggest low cost carrier in Asia, making air travel a reality for the ordinary people.

What has Bung Mokhtar and all the bumiputras, who ran MAS have to show the world what good they have done for this country.

People who lives in glass houses should not throw stones.

He is a coward using parliamentary immunity to shield himself from libel action. 

He should repeat what he said outside Parliament.

Tuesday, August 9, 2011

Is Tony Fernandez Buying Trouble?

Hantu Laut

What would be the strike price in the share swap between MAS and AirAsia ? Is the strike price going to be higher or lower than the market price?

The exercise would call for at least 1 Air Asia share for 2 MAS shares but the valuation could be more because Air Asia market share price is more than twice that of MAS. However, it is up to MAS and Air Asia, they can ignore the market price and set a strike price they both agree on.

It was initially rumoured that the cross holding would give Tony Fernandez's Air Asia majority share in MAS which was later refuted by MAS biggest shareholder Khazanah Nasional Bhd, Malaysia's Sovereign wealth fund. Khazanah has 14.06% direct holding and 52.29% indirect holding through wholly owned Penerbangan Malaysia.It appears that even after the exercise Khazanah would still be a majority shareholder in MAS.

The share swap is between MAS and Air Asia not with Tune Air as reported by the Editor of Malaysian Insider here. Tune air would have indirect interest in MAS through Air Asia.If such holdings were of significant size this would make it difficult for either company's shareholders to displace the existing management; if both were majority holdings it would be impossible to vote out either set of directors.

Unless he has control over the policies and major decisions in MAS I can't see the rational of Fernandez buying into MAS if Khazanah still call the shot.The swap, if successful, would also give Khazanah significant share in Air Asia if they have not already own some shares in Air Asia through nominees.It would also give Khazanah significant role in policy matters. However, if two firms cross hold each other, it is difficult to displace the management in one without the consent of the other corporation.Being a shrewd businessman I am sure Fernandez has something under his sleeve that we have yet to see.

MAS string of failures was not due solely to the CEO, the board of directors should take the bigger blame for the mess the airline is in. One should envisage the problem of working with a bunch of bureaucratic civil servants to appreciate the difficult working environment one can be subjected to.Remember the days when nasi lemak cost the airline RM70.00 a plate.Nasi lemak is certainly not gourmet food, you can get better nasi lemak from street vendors for as little as RM2.50.

Political interference has also contributed to some of MAS losses.The few years that MAS made money under Idris Jala was made more out of assets stripping rather than profits from its operations.Even if they did, the profits were insignificant.

Below Singapore Airlines group financial highlights.

Year ended↓ Revenue
(S$m)↓
Expenditure
(S$m)↓
Operating profit
(S$m)↓
Profit before
taxation (S$m)↓


31 March 1999 7,795.9 6,941.5 854.4 1,116.8

31 March 2000 9,018.8 7,850.0 1,168.8 1,463.9

31 March 2001 9,951.3 8,604.6 1,346.7 1,904.7

31 March 2002 9,382.8 8,458.2 924.6 925.6

31 March 2003 10,515.0 9,797.9 717.1 976.8

31 March 2004 9,761.9 9,081.5 680.4 820.9

31 March 2005 12,012.9 10,657.4 1,355.5 1,829.4

31 March 2006 13,341.1 12,127.8 1,213.3 1,662.1

31 March 2007 14,494.4 13,180.0 1,314.4 2,284.6

31 March 2008 15,972.5 13,848.0 2,124.5 2,547.2

31 March 2009 15,996.3 15,092.7 903.6 1,198.6

31 March 2010 12,707.3 12,644.1 63.2 285.5


All those years Singapore Airline were making profits MAS was losing substantially or profited under extraordinary gains while under Jala's management.It's a 5 star airline with 5 star losses.

Jala left in the nick of time when Najib pulled him out of MAS to join his cabinet.Soon after he left, the airline started showing losses again.Obviously, they have no more assets to strip or major asset unbundling, the formula used in the financial restructuring in 2002 after suffering huge losses.The Binafikir formula have a short shelf life, the airline is back in the red.

Would Tony insists to absorb Firefly into Air Asia and MAS to cease selling low fares to its passengers and stay as a full-fledged carrier? I expect these would be some of the conditions thrown at Khazanah if they were to bring Tony to the board of MAS.

Since the deal between MAS and Air Asia is not yet set in concrete anything can happen, negotiation can still break down if Tony doesn't get what he wants.

Tuesday, September 28, 2010

Team Lotus, Who's Telling The Truth?

Hantu Laut

Read this and make you own assumption whom you think would win the case.

Of heart and mind, one using the heart and the other the head.

Question No.1 why would Tony Fernandez buy Team Lotus Ventures if there was nothing tangible in it and if there was no legal tie up with Lotus to provide its racing expertise?

If there was actually an agreement, than, maybe, the boys at Proton do not know how to read and interpret legal agreement.Fernandez was quite right to take the case to the British court to clear the air.

You can't run a business if you are ruled by your heart and you can't terminate an agreement unilaterally unless there is default.