Khazanah Nasional Bhd, Malaysia Airlines (MAS)' largest shareholder, announced Friday a 12-point recovery plan for the national carrier, which included the creation of a new company to take over MAS' business and the trimming of its workforce.

Khazanah's managing director Azman Mokhtar said the plan involved a comprehensive overhaul of the airline, which would enable MAS to achieve sustained profitability within three years of delisting, by the end of 2017.

"At its core, the plan involves the creation of a new company ( NewCo), which will house the 'New MAS' and the migration of the right-sized workforce and work practices and contracts into NewCo, " he said at a press conference.

There were four categories of this recovery plan, entitled " Rebuilding a National Icon: The MAS Recovery Plan," including governance and financial framework, operating business model, leadership and human capital and regulatory and enabling environment.

According to the plan, MAS would be delisted by the end of 2014, and its relevant operations, assets and liabilities would be migrated to the NewCo. NewCo was targeted to return to profitability within three years of delisting, and to relist within three to five years, that was between the end of 2017 and the end of 2019.

Moreover, as much as RM 6 billion (about 1.9 billion U.S. dollars) of restructuring and investment funding would be disbursed in a staggered basis subject to fulfilment of strict restructuring conditions.

As to the workforce, it was estimated that NewCo would require a workforce of about 14,000, which meant that there would be reduction of 6,000 or 30 percent from the approximately 20,000 current staff in MAS. Khazahah promised to take measures to reskill and redeploy the appropriate MAS staff who do not migrate to NewCo, and actively create new jobs.

As to the leadership, MAS Chief Executive Officer Ahmad Jauhari Yahya would continue to lead the old company during the transition period over the next 10 months to July 1, 2015. "Khazanah has commenced the search process for the CEO of NewCo and we envisage that the conclusion of this search will be announced in due course, expected to be before the end of 2014," Azman said.

MAS would also move its headquarters and principal operations from Subang to KLIA (Kuala Lumpur International Airport), its principal home airport.

Khazanah said on Aug. 8 that it sought to take full ownership of the company and delist the national carrier to facilitate its plan to undertake a comprehensive review and restructuring of MAS.

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