“Tony, Din, no grandstanding!”

“No grandstanding!”. We were told that was what been told to AirAsia CEO Tony Fernandes and ED Kamaruddin Meranun when they wanted to come into Malaysia Airlines.

And yet, today it has been announced that Malaysia Airlines is the major sponsor for Fernandes’s recently acquired Queens Park Rangers.

Published: Monday September 12, 2011 MYT 7:45:00 PM
Updated: Monday September 12, 2011 MYT 8:10:05 PM

MAS, Air Asia in QPR jersey deal

Both signed a two-year sponsorship on Monday allowing the MAS logo to adorn the QPR jersey on home games while the AirAsia logo will be used on the team’s away games, according to the QPR website.

The new blue-striped jersey with the MAS logo will be worn for the first time in QPR’s home game against Newscatle at Loftus Road later on Monday.

“This sponsorship is the first major initiative of our new brand and marketing strategy, that would see important advertising money spent on boosting our top line.

“This is a key component in our drive to regain global market share, profitability and pride for the people of MAS,” said MAS executive director Mohammed Rashdan Yusof.

Air Asia boss Tan Sri Tony Fernandes recently acquired a 66 per cent stake in QPR. Fernandes also sits on the MAS board following a MAS-Air Asia share swap on Aug 9.

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The sponsorship deal was said to be at GBP 10 million.

The amount has yet to be confirmed but regardless, it shows that Fernandes did not heed the ‘gentlemens’ agreement he had with Khazanah Holdings Bhd. Managing Director Tan Sri Azman Mokhtar when they sat down to deal on the ‘share swap’.

How this sponsorship will benefit Malaysia Airlines is unsure. QPR isn’t the blue chip team of the Barclays EPL. In fact, it is at a lower rung of the league. There are many other ways of getting much better attention, if advertising is Malaysia Airlines objective to sponsor QPR.

BPL table as of Sunday 11 Sept 2011

We have yet to see what’s the beef for Malaysia Airlines in this lop-sided share-swap deal, which was brokered by none other than CIMB.

We believed that Fernades never wanted to use AirAsia’s monies to this project. In fact, probably he had Malaysia Airlines insight to be parasited when he went into buying QPR. The Guardian had this story almost four weeks ago.

QPR’s Tony Fernandes looking to build bridges – as well as his fortune

The new owner has made no secret that he bought QPR not only for the love of football but as a sponsorship vehicle

QPR owner Tony Fernandes

The Queens Park Rangers owner, Tony Fernandes, is optimistic about the future of the Premier League club. Photograph: Adam Holt/Action Images

Tony Fernandes said with a little understatement on becoming Queens Park Rangers’ majority owner that he has “a communicative style”, and supporters will justifiably expect their club to be more approachable now, after the high-handedness of the Bernie Ecclestone and Flavio Briatore roadshow. Fernandes, who, with three partners, built AirAsia from a loss-making company with two planes to Malaysia’s version of EasyJet, has that modern businessman’s touch of talking to people and an appreciation of publicity, for himself – complete with famous Twitter account – and for his businesses.

Expressing all the right sentiments to soothe QPR fans’ sullen resentment over the price hikes that immediately followed May’s promotion to the Premier League, Fernandes, in an interview with the Guardian, was not all soft soap, however. He made no secret that he was motivated to buy QPR for £45m not only for the love of football, but as a sponsorship, marketing vehicle for AirAsia, where he remains a significant shareholder, and Malaysian Airlines, in which he and a partner more recently bought a 20% stake.

“Many people do not realise the power of sport to market a brand,” said Fernandes, whose Lotus Formula One team is sponsored by AirAsia, which also sponsored last year’s British Grand Prix and, for a time, Manchester United. “You can spend £40m on advertising and have nothing like the same effect. Around the world, everybody watches Premier League football.”

Through building up AirAsia, which has brought him decoration in several countries including a CBE here, his Formula One escapades and steady profile raising, Fernandes has become a public figure, whose career and success story have been serially told. Born in Kuala Lumpur, where he played the piano at the tupperware parties and conventions that made his mother’s fortune, he was educated in England, at the Epsom College boarding school, then the London School of Economics.

He qualified as an accountant and worked in the music industry for 14 years, including for Time Warner. He did not agree with the AOL merger in 2000, and left the company to do the deal that made his real fortune – buying the debt-laden AirAsia, with three partners, for a token one Malaysian ringgit in 2001.

He said he mortgaged his home and had just £250,000 to invest initially, but he and the partners reshaped AirAsia into a low-cost airline flying, according to its most recent annual report, 18 million passengers to 65 cities in Asia and around the world, turning over £790m and making a pre-tax profit of £200m. Tune Air, the company Fernandes and his partners formed to buy AirAsia, still owns 26%, and he said he sold shares in the airline to raise the cash to buy into QPR. Kamarudin Meranun, a co-investor, who will join the QPR board, is a longstanding Malaysian partner with Fernandes.

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Most important fact is that let us not forget that why and how the share swap deal happened in the first place, Fernandes and Din were brought into Malaysia Airlines and previous CEO tengku Dato’ Azmil Zahiruddin was summarily sacked because Malaysia Airlines was ‘highly unprofitable and in dire state of cash’. Isn’t this high value sponsorship is a quick way of Fernandes and Din parasiting on Malaysia Airlines’ cash position for their own personal benefit?

The “Thirteen Million Ringgit Question” now is, will Malaysia Airlines be parasited to sponsor Fernandes’s Formula 1 team, again for “advertising” purpose? Then again, the Formula 1 commands a wider viewer market as compared to BPL.

There are other better ways of realising the ‘advertising’ objective, without bleeding cash from the company. We were told that during Tan Sri Tajudin Ramli’s stewardship, Malaysia Airlines bought a building near South Kensington for their London office. The building also serve as an advertising platform as it sits on a major route (A4 westwards) from Central London to London Heathrow, Greater London’s premier five-terminal international airport. And when the building was sold off, they actually realised a hefty profit from the capital appreciation.

We hope that the new BOD of Malaysia Airlines, particularly de facto ED Mohamed Rashdan Yusoff comes up with a very good excuse to rationalise this whats seems to be parasiting the national carrier.

Published in: on September 12, 2011 at 20:49  Comments (23)