The AirAsia Group has moved to shore up the coffers of its Indonesia AirAsia (QZ, Jakarta Soekarno-Hatta) unit as Indonesia's civil aviation authority (Direktorat Jenderal Perhubungan Udara - DJPU) continues its clampdown on carriers with negative equity.

The Malaysia-based carrier group said in a filing with the Bursa Malaysia last week that it will purchase up to MYR1.01 billion (USD225.6 million) of perpetual capital securities in PT Indonesia AirAsia (IAA) in which it owns a 49% stake.

The DJPU sent a letter to IAA in May instructing it to address its state of negative equity. IAA subsequently offered to issue AirAsia its new perpetual capital securities.

"The subscription will help to reduce IAA's gearing without any need for AirAsia to inject further funding or capital to IAA as it entails a conversion of the amount owed to the company into equity of IAA," it said. "Failure to address the capital shortfall carries the risk that the Minister of Transportation of the Republic of Indonesia would deny IAA's requests for new route approvals or even impose a suspension of operations."

The perpetual capital securities have no fixed maturity date.