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Thu, Jan 04, 2007 - Page 10 News List

Malaysian airline FAX to unveil cheap flights to UK

MUDDLED REPORT Local media had wrongly reported that the long-haul budget flights would be operated by AirAsia. Tony Fernandes owns a stake in both airlines

AP , KUALA LUMPUR

Fly Asian Express, a Malaysian airline partly owned by budget carrier tycoon Tony Fernandes, plans to offer long-haul flights to the UK and China at cut-rate fares, an executive said yesterday.

The plan will be unveiled at a news conference tomorrow, the executive told Dow Jones Newswires on condition of anonymity because he is not authorized to reveal details beforehand.

He said the local media had wrongly reported that the long-haul budget flights would be operated by AirAsia, the regional no-frills carrier originally founded by Fernandes.

Fernandes is one of the biggest individual shareholders in AirAsia Bhd, and separately owns 50 percent of Fly Asian Express Bhd, which operates turboprop planes in the Malaysian countryside.

Fly Asian Express, also known as FAX, plans to fly from Malaysia to the UK, Europe and China, the executive said, adding that AirAsia, Asia's biggest budget airline, is not involved in the long-haul project.

He said FAX and tycoon Richard Branson's Virgin Atlantic have held only preliminary talks about a tie-up.

The Star newspaper had reported on Monday that AirAsia is in talks with Virgin and another British no-frills airline, easyJet, to form an alliance that will operate long-haul flights at cut rate prices.

From the executive's statements it appeared that the Star report confused between AirAsia and FAX because of Fernandes' ownership in both airlines.

FAX will be the latest airline in Asia to mull offering budget long-haul flights after Oasis Hong Kong Airlines began flights to London from Hong Kong in October.

Fernandes said FAX was in talks with Boeing Co and Airbus to buy or lease wide-bodied jets.

It is not immediately clear how the expansion will be financed.

Subcontract deal

FAX began operations in August when AirAsia subcontracted its rural air rights to the new airline, which operates Fokker 50s and Twin Otters services in eastern Malaysia.

Besides Fernandes, the other major owner of FAX is Kamarudin Meranum, AirAsia's executive director, who holds a 30 percent stake.

Raja Azmi, AirAsia's former chief financial officer, owns the rest.

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