Khazanah Nasional, Malaysia's state investment company, has said it will delist shares in twin disaster-hit national carrier Malaysia Airlines as part of its plan to restructure the company making it fully government-owned.
Khazanah Nasional, which owns 69% of Malaysia Airlines (MAS), submitted a formal request to the carrier's board of directors to undertake a selective capital reduction and repayment programme.
As per the plan, Khazanah Nasional will take over minority shares for 1.38bn ringitt ($429m, €321m, £255m) to become the sole owner of the airline, leading to the delisting of the company from the country's stock exchange.
Minority shareholders would receive 0.27 Malaysian ringgit a share, representing a 29% premium to the airline's average share price over the previous three months.
Trading of shares in MAS has been suspended following the announcement.
In June 2014, Khazanah had announced that it was in the midst of undertaking a comprehensive review of MAS, and would announce a restructuring scheme within a period of six to 12 months.
"We reiterate that the proposed restructuring will critically require all parties to work closely together to undertake what will be a complete overhaul of the national carrier on all relevant aspects of, inter alia, the airline's operations, business model, finances, human capital and regulatory environment," Khazanah said in a statement.
"Nothing less will be required in order to revive our national airline to be profitable as a commercial entity and to serve its function as a critical national development entity."
Khazanah noted that the proposal for delisting represents the first stage of a restructuring scheme for the airline.
It added that it was in the final stages of completing the overall restructuring proposal, and would announce additional details by the end of August, subject to approvals from the relevant authorities, regulators and the Special Shareholder, the Minister of Finance Incorporated.
Adding to its longstanding financial problems, MAS was hit by two major disasters in 2014.
In March, its flight from Kuala Lumpur to Beijing disappeared with 239 people on board. A search is under way in the Indian Ocean for the missing plane.
In July, another MAS flight heading to Kuala Lumpur from Amsterdam was shot down in eastern Ukraine, which is controlled by pro-Russian separatists, killing 298 people.