MAHB: Carving out Subang airport marks radical policy shift, could erode investor confidence

Plans to commercialise Sultan Abdul Aziz Shah Airport in Subang, Selangor – including developing the real estate in the surrounding areas – could scare off foreign investors, warns Malaysia Airports Holdings Bhd (MAHB).

MAHB, in its 80-page Regeneration Plan, added it would mark a radical departure from the decisions and policies outlined in the country’s aerospace and business aviation blueprint, which could also potentially erode investor confidence.

“The change of policies could also lead to a loss of investor confidence. Investors come to a country which is stable, with good governance, sound policies and a business-friendly environment,” MAHB said in its plan, which was submitted to Prime Minister Tan Sri Muhyiddin Yassin last month.

“The trust and confidence in dealing with a government-linked company has also been a major factor for them.

“By attempting to change the current setup, we run the risk of losing our existing major players to Singapore or Thailand, where the operators are GLCs, such as Changi Airport Group for Seletar, the No. 1 in the world.”

Talks of carving out Subang airport remain within the industry. WCT Holdings, controlled by businessman Tan Sri Desmond Lim, had submitted a “concept paper” to the Transport Ministry, revealing plans to take over the airport from MAHB.

This led to MAHB handing over its detailed plans, themed ‘Creating Tomorrow, Here: The Preferred Hub for Aerospace and Business Aviation in Asia Pacific’ to Muhyiddin.

MAHB had outlined its plans moving forward, and the implications of carving out the airport in Subang.

“MAHB is a GLC, with up to 62 per cent owned by the rakyat, through government-linked investment companies like Khazanah Nasional, Employees Provident Fund, Permodalan Nasional Berhad and Retirement Fund.

“Allowing MAHB to implement the Regeneration Plan will ensure that the government can continue serving the best interests of the rakyat.”

MAHB also highlighted that with the Cabinet’s mandate and the operating agreement in place, the company – with its expertise, experience, track record and funding – is ready to “execute (its plans) immediately to unlock the benefits in the shortest time for the nation and government.”

“Alternative proposals from other parties will result in a severe opportunity loss for the nation, as managing legal and land ownership issues and challenges may take between 18 and 24 months,” MAHB added.

It was previously reported that MAHB had, among others, singled out jet operations at the Sultan Abdul Aziz Shah Airport as a “risk” that would adversely impact the KL International Airport (KLIA).