ASEAN KEY DESTINATIONS
Malaysia Airlines hires foreigner as CEO
FOR the first time in its history, Malaysia Airlines (MAS) will have a foreigner as its chief executive officer, who will be given the mandate to chart the restructuring of the company as well as see through its results over the next five years.
In what is seen as a move to send a signal to the various stakeholders that the Malaysian government is not leaving any stone unturned in its efforts to put MAS on a proper footing amid keen competition in the airline industry, it is learnt that Khazanah Nasional Bhd, MAS’ major shareholder, has given its tacit agreement to the candidate.
“The candidate is among three shortlisted. He is a person from the airline industry… not somebody from outside the industry,” a source revealed.
“Apart from the CEO, MAS will also hire another five or six key personnel who are knowledgeable in specific areas of the industry to cut costs.
“For instance, in the area of engineering, which is a major cost centre, a person will be hired to guide the committee on how to rationalise cost without impacting services,” the source said.
Last month, Khazanah unveiled a restructuring plan for MAS that would see its assets being moved to a new company by mid-next year. The plan involved job cuts of 6,000 from the present staff strength of 20,000, and would see MAS being privatised by Khazanah.
It would involve Khazanah pumping in RM6 billion more into the ailing airline.
Khazanah managing director Tan Sri Azman Mokhtar expected the restructuring of the airline to be carried out over three years and for it to be listed beyond 2018.
The new CEO will take over from Ahmad Jauhari Yahya, whose contract has been extended until September next year.
The restructuring of MAS is being undertaken by a specially established committee that comprises several board members.
Last week, MAS appointed Mohd Nadziruddin Mohd Basri as the chief restructuring officer (CRO) in charge of the Restructuring Management Office.
The company said that as CRO, Mohd Nadziruddin would report to the Board Restructuring Committee, a sub-committee of the main board of MAS.
One of the reasons attributed to the previous failed restructuring of MAS was that a non-airline person had been put in charge to drive operations.
“Now the committee in charge of the restructuring is making sure every key post is handled by a person from the industry. If there is no expertise locally, then foreigners will be hired,” said a source.
It is learnt that the contract terms for the new appointments will be based on a three-year period, with a two-year extension period.
“The first three years are to fix the problems and put the structure in place. The subsequent two years are to make sure they deliver the results for MAS.
“Previously, the appointed people gave solutions but were not held accountable to see it through. Now, that is what the board wants,” said a source.
MAS has been losing money for several years now. The situation was made worse by two tragedies in a space of five months between March and July this year.
It prompted the Government to give Khazanah the green light for a complete makeover of the airline.
The new company would be able to accommodate only about 14,000 workers, meaning job cuts for about 6,000 existing employees.
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