AirAsia has withdrawn from an $80 million deal to acquire Batavia Air in Indonesia.
The move would have carried too many risks, according to AirAsia Group chief executiveTony Fernandes.
He said: “Our aggressive focus in Indonesia remains and we will push our Indonesian IPO plans while still maintaining close co-operation with Batavia Air.
“The company’s decision was based on a thorough evaluation by many parties into Batavia Air. In our minds, the timing was perhaps not appropriate as it would have induced too many risks and would ultimately be earnings dilutive to our shareholders.”
Malaysia-based AirAsia will instead collaborate with Batavia Air on a training joint venture to address an expected skilled pilot shortage in Indonesia, a statement said.
AirAsia had announced plans in July to acquire Batavia to expand in Southeast Asia’s biggest economy. It would have been AirAsia’s first major airline acquisition, Reuters reported.