Long-haul budget carrier AirAsia X has reportedly run out of cash and needs to raise up to 500 million ringgit (US$120 million) to restart.

The disclosure was reportedly made by deputy chairman Lim Kian Onn in an interview with The Star newspaper of Malaysia.

The affiliate of Malaysia-based AirAsia Group said it wanted to restructure 63.5 billion ringgit ($15.3 billion) worth of debt and slash its share capital by 90% to continue as a going concern.

Lim said: “We have run out of money. Obviously, banks will not finance the company without shareholders, both old and new, putting in fresh equity. So, a prerequisite is fresh equity.”

He said the airline had actual liabilities of 2 billion ringgit, with the larger figure of 63.5 billion ringgit including all lease payments for the next 8 to 10 years, a large order for Airbus aircraft and contracted engine maintenance with Rolls-Royce.

“If we find 300 million ringgit in new equity, then the shareholder funds are 300 million at the restart of business and if we are able to borrow 200 million ringgit, we feel that we will have a good platform to start all over again,” Lim said.

He said AirAsia X also needed to convince its lessors of its business plan, adding that an unnamed lessor recently took back one of the airline’s aircraft to convert it to a freighter.

The group plans to liquidate its small Indonesia-based carrier and has written down its stake in Thai AirAsia X, with the Thai carrier not part of the restructuring scheme, Lim told the newspaper.