KUCHING, Oct 27 — The Sarawak government and its wholly company Hornbill Skyways Sdn Bhd today signed a memorandum of understanding (MoU) on the management of rural air services by the acquisition of shares in MASwings Sdn Bhd with the Malaysian Aviation Group.

Speaking to reporters after the signing of the MoU, Premier Tan Sri Abang Johari Openg said the takeover of MASwings should be finalised within three months after due diligence has been done.

"Now detailed discussion is being held between the state Transport Ministry and MAG and Khazanah Holdings,” he said.

"We want majority shares in MASwings, but maybe MAG wants some shares,” he said.

Earlier at the signing, Abang Johari said today’s ceremony followed an earlier MoU signed between the state government and federal government on July 20 this year on the hand-over of the rural air services to the state government.

"Air connectivity plays an important role to connect our rural settlements in the hinterland regions and link Sarawak to the neighbouring regions and to the rest of the world,” he said.

"This connectivity is important for us to mobilise our people and to support economic activities,” he added.

Abang Johari noted that Sarawak has vast geographical areas, with many of the settlements and strategic resources such as hydropower, plantations and biodiversity are located in the hinterland.

He said as such, it is critical for the state to serve them with good air connectivity to ensure the people can be mobilised to develop these resources for economic development.

He said the state government has no choice but to have good regional and international flight connectivity since the state is an island.

"Currently, Sarawak’s regional and international air connectivity is serviced by Malaysia Airlines, Firefly, AirAsia, Scoot and Batik Airlines.

"Nevertheless, this existing network is insufficient to meet the demands of the region.

"As we have experienced so far, we cannot depend on private airlines to meet the mobility demands of our people across Sarawak, Peninsular Malaysia, Sabah or even Singapore, as they are operating on profit and loss basis,” he said.

He added the fare charges are sometimes beyond the affordability of the people, especially during the festive seasons.

"In response to these challenges, we are steadfast in our commitment to establish a state-owned airline,” he said, adding the objective is to expand air connectivity and regulate the aviation market and ensure a fair competition within Sarawak and the region.

The premier said while it may not be profit-oriented, the state government’s ambition is clear, that is, to serve the people better.

He with the acquisition of MASwings, the state can tailor its own business model that prioritises its needs.

He said this includes planning routes that cater to meet the demands of the businesses, industries and the people.

"This airline will be able to provide a more guaranteed essential air services even on less profitable routes, ensuring no regions is left without air connectivity” he said.

He said the state government is committed to upgrade MASwings from rural air service provider to regional airline.

"It is our aim to bring Sarawak’s aviation sector to another level and expand air connectivity to nearby regions especially Hong Kong, Shenzhen, Singapore, Indonesia and other Southeast Asian countries,” he added.

At the signing ceremony, the state government was represented by the Permanent Secretary of the state Transport Ministry Datuk Alice Jawan and the ministry’s aviation technical advisor Sio Yew Hua, state-owned Hornbill Skyways Sdn Bhd was represented by its chairman Tan Sri Aziz Hussain and chief executive officer Captain Miron Kumer Ganguly while MAG was represented by its group managing director Datuk Izham Ismail and group chief strategy officer Bryan Foong.