Exclusive | Revealed: How Tony Fernandes’ distaste for acquisitions drove AirAsia’s growth into Southeast Asia’s biggest passenger carrier
- AirAsia looked into a proposal to buy HK Express and Hong Kong Airlines from HNA Group, but declined to buy either, before Cathay Pacific Airways offered HK$4.93 billion for the city’s sole budget carrier
- AirAsia has bought one airline in its 18-year growth, to secure a landing slot in the Philippines
AirAsia, the region’s biggest budget airline, said it prefers to pursue organic growth instead of expansion through acquisitions, partly explaining why it declined to buy Hong Kong’s sole low-cost carrier Hong Kong Express Airways (HK Express).
AirAsia looked at the proposal to buy HK Express and its full-service sibling Hong Kong Airlines, declining to acquire either, said founder Tony Fernandes.
“My philosophy has been organic growth,” Fernandes said in an interview with South China Morning Post during Credit Suisse’s Asia Investment Conference in Hong Kong. “I generally don’t believe in acquisition because it comes with a lot of inherent issues. When you import through acquisition, it comes at a risk, so it’s not my preference.”
Fernandes’ approach illustrates how he turned the Kuala Lumpur-based airline from a near-bankrupt company into Asia’s largest budget carrier in less than two decades, with more than 140 destinations and flying on 320 routes at the lowest unit cost in the global aviation industry.