On February 22, 2021, Malaysia Aviation Group received approval from a court in the United Kingdom allowing it to proceed with a restructuring plan.

Malaysia Aviation Group obtained court approval in the UK for a deal between its leasing unit and a majority of its aircraft operating lessors, permitting it to begin a restructuring plan with new capital of 3.6 billion ringgit ($891 million). The deal will serve as a lifeline to the struggling Malaysia Airlines.

“Now that the scheme has been formally sanctioned by the UK court, the airline can proceed to implement its restructuring plan with the support of its sole shareholder, Khazanah Nasional Bhd and existing stakeholders,” the group wrote in a statement.

Malaysia Aviation Group said it expected the restructuring to be completed in early March 2021. Under the plan,  Malaysian Airlines would strike bilateral agreements with finance lessors, spare engine lessors, maintenance service providers, corporate lenders, and government-related entities. 

“Operating lessors have continued to support the airline with a reset of lease rates to market and deferrals,” wrote the group.

In October 2020, Malaysia Airlines submitted a plan, requiring a fresh cash injection from Khazanah Nasional, the airline’s shareholder, in order to help the company over the next 18 months. The plan also included the restructuring of the airline's balance sheet over five years as Malaysia Airlines needed nearly $5 billion to continue operations until 2025. However, the plan was rejected by lessors forcing the group to consider shutting down the operations.

The national air carrier of Malaysia has been suffering from financial struggles since 2014, when two of the airline’s aircraft were involved in catastrophes. The disappearance of the flight MH370 in March 2014 was followed by the fatal shooting down of the airline’s Boeing 777-200 (the flight MH17) while flying over Eastern Ukraine in June the same year. 

Malaysia Airlines has been in competition with the airlines from AirAsia Group. However, the global pandemic has put air carriers into crisis mode. Currently AirAsia X seeks to restructure its total debt of 64.15 billion ringgit ($15.3 billion).

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Malaysia Aviation Group (MAG), the holding company of Malaysia Airlines, announced that the group would have “no choice” but to shut down operations if lessors chose not to back the airline’s restructuring plan. The company considered closure after its restructuring plan had been rejected by lessors on October 9, 2020.