Weststar helicopter concession estimated to cost RM6.41 billion
The 18-year government concession covers 28 helicopters, with all deliveries scheduled by December 2027, according to MARC Ratings.
Weststar Aviation Sdn Bhd's project to supply and maintain helicopters for the Malaysian government has an estimated cost of RM6.41 billion, according to MARC Ratings. Financing will comprise RM5.76 billion through a sukuk programme and shareholder equity of RM640.5 million.
MARC gave the company's proposed sukuk, which has a ceiling of RM6 billion, a preliminary AA+IS rating and stable outlook. It cited predictable government cash flows, the operating record of parent Weststar Aviation Services Sdn Bhd and Leonardo SpA's helicopter manufacturing and delivery capabilities.
Administered by the National Security Council (MKN), the 18-year concession covers 28 helicopters for six agencies handling defence, security and emergency response. It also provides training for over 1,440 engineers, pilots and crew members. Aircraft duties include medical evacuations, search and rescue, patrols, utility work and training.
An initial sukuk issuance of about RM3.83 billion is expected in 2026. Proceeds will refinance existing syndicated facilities, partly reimburse eligible advances from the parent and fund outstanding initial project needs. Further issuances of about RM1.93 billion are expected in 2027 to refinance advances for remaining capital expenditure.
The parent has committed additional support capped at 10 per cent of project cost for possible overruns, sukuk profit payments, fees and expenses. Fixed monthly payments for each aircraft will support debt servicing regardless of flying hours, provided availability conditions are met, MARC said.
MARC identified delivery execution, strict aircraft availability conditions and possible concession payment delays as risks. Principal repayments are expected from 2028, reaching a peak of about RM515 million a year during 2031–2035.
All deliveries are scheduled by December 2027, ahead of the June 2028 concession deadline. The Prime Minister's Department received its first helicopter on 15 October 2026. The Fire and Rescue Department received one on 1 November, with its second due in December. The other 25 aircraft are expected during 2027.
