Malaysia's Transmile will not sell unit, for now

KUALA LUMPUR Nov 19 (Reuters) - Malaysian air cargo operator Transmile Group TMGB.KL said on Thursday it would not sell its aircraft maintenance unit to national carrier Malaysian Airline (MASM.KL) as the letter of intent had expired.

"However, both parties will continue to be in dialogue in the event that opportunity arises for the parties to pursue the proposed transaction in future," Transmile said in a filing with the stock exchange.

No timeframe was given.

Malaysian Aerospace Engineering Sdn Bhd (MAE), a unit of Malaysia Airline, was supposed to buy Transmile's base maintenance and engineering capabilities including 2 hangars, equipment, and employment of its skilled manpower.

Financial details of the transaction were never revealed.

MAE was also supposed to provide heavy maintenance services to Transmile's fleet of 16 freighter aircraft.

MAE services 80 customer airlines including Lufthansa (LHAG.DE), Saudi Arabian Airlines, Jet Airways (JET.BO) and Delta Air Lines Inc (DAL.N).

Shares of Malaysian Airline edged 0.3 percent higher at 3.12 Malaysian ringgit ($0.923) and Transmile ended down 1.9 percent at 1.02 ringgit. ($1=3.382 Malaysian Ringgit) (Reporting by Niluksi Koswanage; Editing by Jon Loades-Carter)