Stock Picks #1
AirAsia Berhad (AIRASIA)
Week high : RM 3.76 (Up 43sen - 13%)
On 2 May,
Khazanah Nasional Bhd and Tune Air, the major shareholders of Malaysian
Airline System Bhd (MAS) and AirAsia Bhd respectively announced that
they had agreed to terminate their share swap agreement.
The reason? – On 3 May, an excerpt from an interview with Air Asia CEO Tony Fernandes by TheStar
indicated that he has given up his attempt to turnaround MAS due to a
few negative detractors with selfish attitude who made the most noise in
MAS. He and Datuk Kamarudin Meranun have subsequently resigned as
directors from MAS board
It is worthy to note that AirAsia stock price had fallen 6% since the share swap deal was agreed in August last year indicating negative market reaction towards the share swap deal.
Therefore, the market reacted positively when the share swap deal was announced terminated on 2 May. OSK Research mentioned on 3 May that investors will be pleased by the fact that Tony Fernandes could now fully focus on being group CEO of AirAsia.
AIRASIA stock rose 13% (43 sen) since 2 May to week’s highest RM 3.76 on 3 May and closed at RM 3.64 at the end of this week.
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