Sometime in 2018, ACN successfully secured the procurement contract of Pos Asia Cargo Express Sdn Bhd “POS ACE” (Now rebranded with a new name World Cargo Airlines “WCA”) to provide the dry lease of 2 units of B737-400F for a 5 years Term. POS ACE Sdn Bhd is an airline company in Malaysia holding an approved AOC for the operation of cargo aircraft under the purview of Civil Aviation Authority of Malaysia (CAAM). POS ACE is a 100% subsidiary of POS Malaysia Berhad (www.pos.com.my) , the national postal company of Malaysia.
These aircraft are meant to replace 2 other units of the same model that POS ACE previously leased from an American leasing company in 2019 after 7 long years of lease term. The said aircraft were operated by POS ACE to deliver the air cargo shipments of POS Malaysia daily to different parts of the region.
Subsequently, ACN secured the funding from EXIM Bank Malaysia (Export Import Bank of Malaysia, a fully owned government bank under the Ministry of Finance in Malaysia) and purchased one unit of a newly converted B737-400F MSN 25099 from a company called Avmax, in Canada. The aircraft was taken delivery from conversion in PEMCO, Tampa Florida, and delivered to POS ACE in mid 2019. MSN25099 is operating under POS ACE performing deliveries for POS Malaysia’s parcels and mails daily to the East Malaysian States of Sabah and Sarawak.
Later on during the 4th quarter of 2019, POS Malaysia decided to appoint ACN as the Manager of POS ACE. Hence, in addition to the leasing contract of the freighter aircraft to POS ACE as mentioned earlier on, ACN was then appointed to manage POS ACE i.e. the total management of the airline company, and to perform the air cargo delivery service for Pos Malaysia on behalf of POS ACE. This is to be done by way of ACN utilising the freighter aircraft operated under POS ACE’s Air Operating Certificate “AOC”. The Management Contract is for a term of 5 years effective 1st Dec 2019.
Pursuant to the success of POS ACE under its management, ACN was then offered the privilege to partner POS Malaysia and acquire 51% (majority) shareholding stake in POS ACE. This acquisition comes with a 10 years contract from POS Malaysia attached with it. Hence, the 5 years Management Contract is now extended to 10 years pursuant to the completion of the acquisition exercise. The signing of the Acquisition was made on the 19th of August 2020 making ACNthe 51% shareholder of POS ACE and a partner to the esteemed Pos Malaysia Berhad.
The operation of exclusive freighter service for Pos Malaysia’s requirement have always been there since the 80s started with the utilization of B737-200F aircraft. The aircraft are based in Kuala Lumpur for daily operations into the East Malaysian States of Sabah and Sarawak namely Kuching, Kota Kinabalu, Miri, Tawau and Sibu. This operation currently utilize up to 600 block hours of the aircraft each month. With the recruitment of our B737-800BCF, the operation will be extended to Hong Kong and China where Pos Malaysia’s loads are now carried via other freighters and commercial airline arrangements. Very soon, the exclusive freighter service for these new international sectors will be operated for Pos Malaysia. Hence, the ideal requirement for the B737-800BCF.
Moving forward, the acquisition exercise of 51% stake in POS ACE placed ACN at a formidable position as described below;
- The ownership of a cargo airline in Malaysia with a fully active Air Operating Certificate “AOC”
- A 10 year service contract from Pos Malaysia Berhad with an average turnover of RM 1.5 Billion (USD 350 million) in total
- A partnership with POS Malaysia which means an immidiate captive market from the air cargo movements of Pos Malaysia’s parcels, genco and e-commerce items that is the future of this industry.
- The acquisition will set the stage profoundly for ACN to widen its regional market dominance in combination with its other cargo airliner in Indonesia i.e. PT Tri MG Intra Asia Airlines
Montague Choy of Clifford LLP
Monty specialises in private client matters, corporate and commercial law, having chalked up some impressive work experience as Head of Risk and Credit Management and Corporate Affairs manager at an established large local law firm. His areas of expertise include private wealth planning and structuring, family and personal law, structuring of companies (onshore and offshore), mergers and acquisitions, fund raising activities and commercial transactional matters.
Monty also serves as independent legal counsel and advises the Boards of many corporate clients, which include both onshore and offshore entities. He is trained in law in the UK with LL.B. (Hons), University of Liverpool and Barrister-at-Law (Middle Temple).
He has been the External Corporate Legal Advisor for ACN Group of Companies since 2018 and has been instrumental in the Group’s corporate and fund raising exercises.