Malaysia's Sarawak state government is open to the Malaysia Aviation Group (MAG) retaining a minority shareholding in MASwings (MY, Kota Kinabalu) in the event the Sarawak government succeeds in its bid to take over the airline.

Sarawak Premier, Tan Sri Abang Johari Openg, told local media last week that pending the completion of talks and due diligence, he hopes to complete the takeover within three months. He was speaking while signing a memorandum of understanding (MOU) with Sarawak government-owned Hornbill Skyways (Kuching) and Malaysian government-owned MAG. The MOU detailed plans for managing MASwings under the Sarawak government. Its general aviation operator, Hornbill Skyways, appears set to play a significant role.

"We want majority shares in MASwings, but maybe MAG wants some shares," said the premier. In addition to local politicians, Malaysia's transport minister and the managing director of MAG attended the MOU event. MAG Managing Director Izham Ismail did not say whether he intended to retain a stake in MASwings. Johari Openg added that the due diligence process was underway, and negotiations with officials from Khazanah Nasional Berhad, Malaysia's sovereign wealth fund, continue. The premier wants to tap the fund to pay for MASwings.

"If possible, next year it will fly," he said. MASwings operates a fleet of ten ATR72-500s and six DHC-6-400s and already connects the Sarawak state capital of Kuching with Penang, Miri, and Kota Kinabalu. However, Johari Openg wants to transform it into an operator flying longer sectors of six or seven hours. "When we take over MASwings, our flight destinations must be outside Borneo," he said. "One of our proposals is to fly into regional cities. This means we can reach countries like Korea, Hong Kong, Japan, and cities in that region. It would also serve India and Australia."

The premier said the MASwings operating model under Sarawak ownership would differ from competitors. Rather than maximising profit, the emphasis would be on providing cost-competitive fares in and out of Kuching. Johari Openg said this was a viable plan if he kept the fleet small and working hard. "If the aircraft doesn't fly, then there will be no money coming in," he said. The premier did not say what type of aircraft he wanted to acquire to operate these longer routes, nor did he detail how, when, and where he would source them from. "I want to emphasise here that this airline will not be a large airline," he said. "It will be a boutique airline that services regional routes."