Jakarta/Kuala Lumpur. Indonesia has threatened to suspend the operating licenses of 13 airlines including the affiliate of Malaysian carrier AirAsia unless they raise new equity by the end of this month.

These airlines were found to have “negative equity”  ̶  meaning that the value of their assets used to secure a loan is less than the outstanding balance of the loan  ̶  and must turn it positive by July 31, said the transport ministry of Southeast Asia’s biggest economy.

“If they don’t meet the requirement, we will suspend them,” Transport Ministry spokesman J.A. Barata told Reuters by telephone. “If they don’t have enough capital, how will they ensure the safety of passengers?”

Indonesia AirAsia, which is 49 percent-owned by AirAsia, needs at least Rp 3.035 trillion ($227.77 million) to reverse its shareholder funds deficit, Malaysian brokerage TA Securities said in a research note on Tuesday.

The company may explore options such as issuing debt or new shares as “it could be a costly decision to cease operations in Indonesia,” TA Securities said. “We believe AirAsia would keep the company afloat as Indonesia is one of the important networks within the AirAsia group.”

Indonesia AirAsia had received a letter from the transport ministry on the positive equity requirement, AirAsia said in a filing to the Malaysian stock exchange on Tuesday.

“As this is a matter which has only been made known to us, we together with Indonesia AirAsia are currently studying the letter closely as well as to seek a meeting with the Ministry of Transport,” AirAsia said.

Last month, AirAsia’s shares were hit after Hong Kong-based GMT Research accused it of using transactions with associated companies to boost its earnings.

Reuters

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