As AirAsia’s rapid transformation from an airline into a digital travel and lifestyle services group continues to gain strong momentum, the holding company for the airline group has been officially renamed AirAsia Aviation.
Bo Lingam, formerly president (airlines) for AirAsia Group, takes over as group CEO of AirAsia Aviation, overseeing the four airlines – AirAsia Malaysia, AirAsia Philippines, AirAsia Thailand and AirAsia Indonesia.
AirAsia Aviation is part of the portfolio held by AirAsia Group Berhad (AAGB), the investment holding company, joining other companies – the airasia Super App, cargo and logistics venture Teleport, BigPay financial services, the edutech arm AirAsia Academy, engineering company Asia Digital Engineering, ground services division GTR, and the restaurant chain and food group called Santan.
Commenting on the move, Lingam said: “This structural change helps facilitate strong projected growth in both airline and non-airline portfolio businesses.
“The AirAsia Aviation entity holds our existing airline investments and paves the way for new airline ventures to be formed in due course. We have also established a new AirAsia Consulting division tasked at reviewing new airline partnerships and franchise opportunities.
“By creating this airline holding company we can focus on continuing to be the world’s best low cost airline. We have spent the past 18 months reviewing every aspect of the operation to ensure that our airlines will return stronger than ever before. The world is finally opening up and we foresee a V-shaped rebound in air travel in the near future.”
Lingam shared observations of “huge pent up demand for air travel” in Malaysia as interstate travel resumed on October 11.
“We are operating over 60 daily flights to 16 key leisure destinations, and more frequencies and routes will continue to be added in response to significant consumer demand,” he said.
Services in Thailand, Indonesia and the Philippines are also resuming in line with accelerated vaccination rates and the easing of travel restrictions in our key markets.
“We look forward to the opening of international borders as the next key milestone. We will continue to review new markets to operate from in the future, like Cambodia for example, when we can connect (South-east Asia) once again with the best value fares and lifestyle offerings,” said Lingam.
Indonesia’s Artotel Group has completed a Series B funding for an undisclosed sum, led by Indies Capital Partners, a leading South-east Asian alternative asset manager, with participation from creative industry-focused Benson Capital.
Artotel Group will utilise the proceeds to drive expansion through an aggressive merger and acquisition strategy in Indonesia’s hospitality sector, and invest in strengthening the group’s core business infrastructure, digitising operations, and enhancing sustainability throughout the organisation.
Erastus Radjimin, founder and CEO, Artotel Group, told TTG Asia: “With the rapid development of second- and third-tier cities like Sentul, Malang, Cepu and Banyuwangi, and the improved infrastructure across Indonesia, we see the opportunity to reach out to the (various) domestic market with many options that the Artotel brand alone cannot.”
The group is in the process of rolling out 29 new properties across the country, plumping up its portfolio to over 50 by 2023.
In tandem with the investment, Artotel Group has acquired the Indonesia franchise of Kyriad, a hospitality brand created by France-based Louvre Hotels Group. The deal includes 11 managed properties in the country, adding 1,300 rooms to Artotel’s portfolio. The group will continue to manage the properties under the established Kyriad brand and develop new two- and three-star hotels under the brand in second-tier cities throughout Indonesia.
Erastus said: “Kyriad is the first non-standardised hotel chain at the three-star level. We see the opportunity to develop (the brand) in cities like Purwoketo and Jember where an Artotel brand is (not feasible) due to the project cost or the (local) price level.”
The Kyriad acquisition brings Artotel Group’s total room count to around 3,000.
Erasutus revealed that another acquisition would be announced next month.
Pandu Sjahrir, managing partner at Indies Capital Partners, said: “Artotel Group has demonstrated resilience in this pandemic through effective management and streamlining business operations. Looking ahead, we will support Artotel’s long-term ambitions by strengthening the group’s corporate and technology infrastructure, as well as implementing strategic business plans geared to drive sustainable growth,”
Avina Sugiarto, senior vice president at Indies Capital Partners, expects Indonesia’s tourism industry to continue to grow post-pandemic on the basis of a burgeoning domestic middle-class and strong International appeal.
Meanwhile, Ben Soebiakto, co-founder at Benson Capital, revealed that the company would leverage its expertise in the creative industry to support Artotel’s unique art-inspired offerings.
Prior to this, Artotel Group’s Series A investment had come from Intudo Ventures.