By Nausheen Thusoo and Yantoultra Ngui
(Reuters) -Budget airline AirAsia parent Capital A said on Wednesday it plans to list its brand management business on the Nasdaq by entering into a deal with a special purpose acquisition company Aetherium Acquisition Corp.
Under the deal, Aetherium Acquisition will acquire all the issued and outstanding share capital of Capital A International, resulting in the formation of a new listed entity, according to a stock exchange filing.
Aetherium Acquisition will ascribe to Capital A International for an indicative equity value of $1 billion alongside additional net cash proceeds.
Capital A International will acquire 100% of both Brand AA, the registered proprietor for all the rights in AirAsia brand, and aircraft leasing company Fleet Consolidated from Capital A, according to the filing.
Capital A International intends to generate revenue from brand royalty and leasing of aircraft, the filing showed.
“Upon the completion of the proposed business combination, the group will have exposure to the capital markets in the USA through NASDAQ,” Capital A said in the filing.
It added that the deal provides an opportunity to unlock the value of its AirAsia brand.
Capital A expects to record a one-off gain from the proposed combination, it added.
Aetherium, a blank-check firm, has $29.99 million in its trust account, which is subject to underwriting fees, the filing showed.
Both Aetherium and Capital A International will attempt to secure financing in the form of private investments in Aetherium’s shares, or private investment in public equity, Capital A said.
Tony Fernandes and Kamarudin Meranun founded AirAsia in 2001 with two aircraft and it has since become one of Asia’s largest airlines with a fleet of some 200 planes serving markets including Southeast Asia and China.
But it was hit by pandemic travel restrictions in Asia, leading domestic bourse Bursa Malaysia Securities to classify its parent Capital A as a PN17 company, or financially distressed, last year.
Capital A has since been evaluating fundraising options for a planned U.S. listing thereafter.
Shares of Capital A have climbed 32% year-to-date.
(Reporting by Nausheen Thusoo in Bengaluru and Yantoultra Ngui in Singapore; Editing by Mrigank Dhaniwala/Sonia Cheema and David Evans)