Minority shareholders of Malaysian Airline System Berhad (MAS) today approved a proposal for a selective capital reduction and repayment exercise of MAS pursuant to Sections 60 and 64 of the Companies Act, 1965 (“Proposed SCR”).

The Proposed SCR was made by Khazanah Nasional Berhad (Khazanah), the majority shareholder of MAS, in its letter to the Company on 8 August 2014. Ordinary minority shareholders will receive a capital repayment amount of RM0.27 per share which represents a premium of the 5-day to 6 month volume weighted average share price of 14.9% to 22.8% respectively (as at 8 August 2014).

The approval from the minority shareholders to accept the Proposed SCR was made at an Extraordinary General Meeting (EGM) held at MAS Academy in Kelana Jaya, Petaling Jaya.

The Proposed SCR offers the minority shareholders the opportunity to exit at a premium to the prevailing price of MAS shares, so as not tobe subjected to associated risks and uncertainties relating to the execution of the proposed restructuringwhich is currently being planned by a dedicated MAS management team.

“Today’s decision by minority shareholders in support of the Proposed SCR is premised on the view that the offer price is fair and reasonable as stated by the independent advisor, AmInvestment Bank Berhad, in its independent advice letter dated 15 October 2014 as well as the recommendation of the independent directors of MAS to vote in favour of the Proposed SCR,” said Ahmad Jauhari Yahya, Group Chief Executive Officer.

“Our shareholders’ approval represents a first but major hurdle crossed, and there is much more to be done. We hope to complete the SCR process before the end of the year,” added Ahmad Jauhari Yahya.

The Proposed SCR will become unconditional upon grant of the sealed order from the High Court of Malayaand the filing of the same with the Companies Commission of Malaysia. Barring any unforeseen circumstances the Proposed SCR is targeted to be completed by December 2014 at which point MAS will be delistedfrom the Main Market of Bursa Malaysia Securities Berhad.

In the meantime, there will be no interruption to MAS operations. The Company will continue to fly, honour existing reservations and plan future travel.