August 8, 2014 / 2:11 AM / 3 years ago

UPDATE 1-Malaysia Airline's shares suspended pending announcement

(Adds reference to earlier Reuters story on share suspension)

KUALA LUMPUR, Aug 8 (Reuters) - Malaysia Airline System Bhd (MAS) said on Friday that it had halted trading in its shares pending an announcement, confirming an earlier report by Reuters.

The airline said trading of its shares would be suspended from 9 a.m. local time (0100 GMT), without specifying the duration of the suspension.

Sources told Reuters on Thursday that a suspension of MAS shares would pave the way for plans by Khazanah Nasional Bhd to take it private as the first step in a major restructuring. The state investor owns 69 percent of MAS.

The business outlook for the Malaysian flagship carrier deteriorated after one of its aircraft, Flight MH370, disappeared on March 8. The airline’s problems deepened on July 17 when another jet, Flight MH17, was shot down over Ukraine, killing all 298 people on board. The incident sped up efforts for the government to restructure the airline, sources said.

A de-listing would pave the way for Khazanah, which is chaired by Prime Minister Najib Razak, to revive the loss-making carrier, possibly by selling off its profitable engineering, airport services or budget airline units, trimming its payroll and installing a new management team.

Sources said Khazanah is expected to pay a premium to Thursday’s closing price of 24 sen per share. (Reporting by Yantoultra Ngui; Editing by Ryan Woo)

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